Contrary to popular belief, it is statically NOT true if the Fed increases interest rates, home prices will come down. It IS true, if interest rates are increased home prices will go UP.

In August 2014, Dr. Steve Sjuggerud from Stansberry and Assoc. Investment Research wrote, “Housing rises faster than normal when the Fed raises rates. And it rises slower than normal when the fed cuts rates, and home prices tend to do better when the Fed is raising interest rates … based on data over 46 years, Take a look”


Average Return 6 Months 1 Year 2 Years
Start of cutting rates 1.8% 4.7% 8.9%
Start of raising rates 3.7% 6.7% 13.3%
All Periods 2.7% 5.3% 10.9%


Fear of prices or interest rates increasing is one of the factors that motivate buyers to buy a home.  When the feds increase interest rates, the news media reports the change and people start to buy again. As home sales increase, inventories go down and prices go up—“Supply and Demand”.

Today, interest rates are still historically low at around 4% for both conventional loans and jumbo loans.

In San Luis Obispo County, homes are certainly selling.  This year, 2014, 1,794 homes have sold with 503 homes in escrow.

Currently, there are 1,092 homes available for sale priced as low $239,000 for a condo in Templeton, CA or as high as $19,000 for a 3,500 acre range in Arroyo Grande, CA.

Inventories are high, which historically is the best time to buy.  If you are a buyer and have not decided if it is time to buy, you may want to decide before interest rates increase and price go up.

Check out all of the available one in San Luis Obispo in Real Time on my web site at

David Norwood- Central Coast Real Estate – Real Time Home Search or

Call me at 805-270-5860 and I can send you link to affordable homes you will love.

David Norwood-Central Coast Real Estate David@DNorwood.com


About David Norwood - Central Coast Real Estate

ABOUT DAVID NORWOOD Real Estate Broker DRE# 01260196 - 805-270-5860 David@Dnorwood.com http://dnorwood.com David Norwood owned a marketing, design, and photography studio in Los Angeles for 25 years, from 1976 to 1999. He also worked as a Licensed Real Estate Appraiser from 1994 to 1999. After moving to the Central Coast in 1999, he worked as a Realtor/Associate, and shortly afterwards earned a Real Estate Brokers License. Now he has his own brokerage company, David Norwood Central Coast Real Estate. Licensed Real Estate Broker #01260196 Licensed Real Estate Appraiser exp. Master of Science Degree, Cal Poly BA Art / Marketing, Photography and Design Areas Served- All of the Central Coast including, but not limited to: Arroyo Grande, San Luis Obispo, Oceano, Grover Beach, Nipomo, Morro Bay, Cambria, Santa Maria, Cayucos, Los Osos, Santa Margarita, Atascadero, Templeton, Paso Robles, Avila Beach, Pismo Beach and Shell Beach;
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