- Home prices rose 5.5% year-over-year as of December 2023 despite higher mortgage rates.
- Mortgage rates are expected to remain above 6% through late 2024, per Goldman Sachs.
- Las Vegas inventory stays low as sellers cling to ultra-low mortgage rates.
- Around 15.6% of buyers used seller concessions to lower financial burden in Q3 2023.
- Mortgage delinquencies hit a historic low under 2% by the end of 2023.
If you’re feeling paralyzed by rising mortgage rates, you’re not alone. The term “mortgage rate fatigue” is spreading as more would-be buyers and investors delay entering the housing market in hopes of better timing. However, if you consider long-term real estate investing fundamentals, waiting may do more harm than good. Steve Hawks, one of Las Vegas’ most experienced real estate agents with over 4,000 successful transactions, breaks down exactly why waiting may cost you—and how to stay ahead of the curve no matter which way mortgage rates move.
Mortgage Rates in 2024: Volatile but Stabilizing
Since the beginning of the COVID-19 pandemic, mortgage rates have gone on a rollercoaster ride. In 2020 and 2021, 30-year fixed mortgage rates dipped to historic lows—hovering around 2.65% in January 2021 (Freddie Mac). Fast forward to early 2024, and the same loans are now averaging over 7%. For many potential homeowners and investors, this increase has changed the risk-reward calculation.
But while 7% feels high compared to recent years, it’s not historically unusual. For context, average mortgage rates in the 1990s and early 2000s landed between 6% and 8%, and many buyers still successfully built wealth during those times. The Federal Reserve’s aggressive moves to battle inflation have brought some stabilization to the market, suggesting that rates might plateau—but significant drops likely aren’t on the near horizon.
What’s Driving Rates Up?
Higher mortgage rates are largely a result of inflation-fighting measures led by the Federal Reserve. As inflation escalated in 2021 and 2022, the Fed raised its benchmark interest rates at an aggressive pace, which directly influenced borrowing costs across the board—including mortgages. While inflation has begun to cool, the Fed has been clear: it will only ease rates when confident inflation is sustainably under control.
Why Waiting for Lower Mortgage Rates Can Backfire
Many potential buyers and investors are falling into the trap of “waiting it out” until mortgage rates drop. But this strategy often backfires for several key reasons
Home Prices Are Still Rising
According to CoreLogic, home prices jumped 5.5% nationally in the 12 months leading to December 2023. In desirable markets like Las Vegas, that increase can be even steeper. While you’re waiting weeks or months for a desirable rate drop, property values are climbing—offsetting or negating your intended savings.
Market Timing Rarely Works
Trying to perfectly time the housing market is like trying to predict the stock market—it’s nearly impossible. Real estate investing is about time in the market, not picking the bottom. Over the long term, appreciation and compound equity gains typically outweigh marginal changes in rates.
Your Cost of Waiting Adds Up
If home prices rise even 2–5% annually while rates stay high, buyers who delay could pay tens of thousands more for the same property a year from now. Plus, you forfeit months of principal reduction, tax advantages, and potential rental income.
Las Vegas Real Estate: Why It’s Still a Seller’s Market
Las Vegas remains one of the most active real estate markets in the U.S. thanks to a unique mix of population growth, limited inventory, and economic expansion. Here’s why buying property here may still make sense—even with higher mortgage rates.
Locked-In Sellers = Reduced Inventory
Many current homeowners are sitting tight, enjoying mortgage rates locked in during the sub-4% era. This has slashed inventory levels across Las Vegas. Fewer homes for sale naturally leads to more competition among buyers, which puts upward pressure on prices—even with higher rates.
Inbound Migration From High-Tax States
Buyers from states like California and New York are trading high cost of living and tax burdens for the relatively affordable, tax-friendly environment of Las Vegas. This trend fuels demand, especially in suburban neighborhoods with good schools, quality infrastructure, and outdoor access.
Job Growth and Economic Expansion
Las Vegas is no longer solely reliant on tourism and gaming. Major developments in healthcare, tech, logistics, and entertainment have contributed to a more resilient local economy. As high-paying jobs expand, so does the pool of quality buyers and tenants—making Las Vegas prime for real estate investing.
Smart Strategies for Real Estate Investing in High-Rate Environments
High interest rates don’t mean you have to sit out. Savvy investors adapt. Here are effective tactics to help you thrive amid elevated borrowing costs:
Adjustable-Rate Mortgages (ARMs)
ARMs typically offer lower initial rates than 30-year fixed loans. For investors intending to hold a property for less than 7–10 years—or who plan to refinance—this option can reduce monthly expenses while increasing your ability to borrow.
Negotiate Seller Concessions
According to Redfin, 15.6% of home buyers negotiated credits in Q3 2023. This could mean sellers covering closing costs, insurance, or even buying down the interest rate on your mortgage. Don’t be afraid to structure your offers aggressively to make the numbers work in your favor.
House Hacking
Live in one part of the home while renting out another. Duplexes, triplexes, and even single-family homes with ADUs (accessory dwelling units) can provide income to offset your mortgage.
Focus on Cash-on-Cash Return
In markets like Las Vegas, cash-on-cash return (annual pre-tax income divided by the total cash invested) becomes more relevant than cap rates during high-rate environments. Carefully evaluate each property’s cost, projected income, and holding period to measure true ROI.
Real Estate Investing Is a Marathon, Not a Sprint
No real estate strategy is perfect—but almost all benefit from time and patience. Historical data shows that property values tend to increase over the long haul. Think about it
- An investor who bought a $300,000 home in Las Vegas in 2018 would now be sitting on a property worth over $400,000, even with a 5–6% mortgage.
- Monthly rent increases and property appreciation mean they’ve earned equity and income simultaneously.
Trading the uncertainty of mortgage rates for certainty of asset growth is often a wise exchange—particularly in real estate investing.
This Isn’t Another 2008—and Here’s Why
The housing market of 2024 looks drastically different from the circumstances that led to the 2008 crash. Here’s how today’s environment is fundamentally stronger
Tighter Lending Standards
Post-2008 reforms like the Dodd-Frank Act ensured stricter verification for borrowers. Today, most buyers are well-qualified with stable income and solid credit.
Subprime Mortgages Are Scarce
No-doc loans, teaser-rate ARMs, and other high-risk lending products that caused the last crash are no longer prevalent.
Low Mortgage Delinquency Rates
Mortgage Bankers Association reported that delinquencies were under 2% in Q4 2023. This is a historic low and indicates strong borrower health.
Supply Is Much Lower
In 2008, a flood of new construction outpaced demand. In 2024, supply is constrained, not inflated—reducing the risk of mass price drops.
When Will Mortgage Rates Drop?
It’s the question buyers and investors ask constantly. Unfortunately, there’s no magic answer—but several key insights help clarify expectations.
Expert Forecasts Say Not Anytime Soon
Goldman Sachs projects average mortgage rates will stay above 6% for the rest of 2024. While modest decreases are possible, significant relief isn’t expected in the near future.
Waiting Can Be Costly
Assuming that rates drop 0.5% by mid-2025, will the savings in monthly payment outpace the rise in home prices, insurance, taxes, and missed equity? Often, the answer is no.
Where the Smart Money is Going in Las Vegas
Not all neighborhoods respond to market shifts equally. Strategic investors working with experts like Steve Hawks are targeting fast-growing or undervalued neighborhoods.
Top Investment Zones
- Henderson: Strong schools, safety ratings, upscale retail—ideal for family renters and professionals.
- Southwest Valley: Expanding rapidly with new construction, shopping centers, and proximity to the Strip.
- Centennial Hills: Offers lower price-per-square-foot and access to outdoor recreation and healthcare jobs.
- Downtown Opportunity Zones: Attracting public and private investment, great for long-term appreciation plays.
Steve Hawks has guided investors in identifying these pockets early, locking in value before broader market awareness catches on.
Renting Feels Safe—But Is It Really Cheaper?
Resisting high mortgage rates by continuing to rent might make sense on paper—until you examine the numbers.
Rent Has Risen Dramatically
Realtor.com reports the U.S. median rent in December 2023 stood at $1,959, just $80 below its all-time high. In most metros, renting no longer looks like the “budget-friendly” option it once was.
Missed Equity = Lost Wealth
Each rent check is essentially a payment toward someone else’s mortgage—building their equity, not yours. Buying turns housing costs into forced savings and long-term growth.
Mind Over Mortgage: Understanding the Psychology
Too often, buyers let fear—not logic—drive their decisions. “Mortgage rate fatigue” is paralyzing millions, leading to missed opportunities.
Metrics Over Fear
Winners focus on metrics: current rents, appreciation trends, vacancy rates, local supply/demand dynamics, and tax incentives. Letting headlines dictate decisions results in more hesitation than wealth accumulation.
Steve Hawks offers a refreshing approach: “Buy property, improve it, and let time do the rest.” It’s a long game—but one where decisive action pays dividends.
Ready to Build Wealth? Act Now
While others panic over headlines, savvy investors focus on fundamentals. The housing market in Las Vegas still offers strong income potential, equity growth, and competitive inventory with the right strategy.
Let Steve Hawks help you
- Explore alternative financing tools
- Identify undervalued high-potential neighborhoods
- Structure offers tailored to today’s conditions
- Start—or scale—your real estate investing
The bottom line? Waiting for ideal mortgage rates may not pay off. Buying property now—with strategic planning—can jumpstart your path to financial freedom.
Ready to stop riding the mortgage rate rollercoaster? Connect with Steve Hawks today to find unbeatable buying opportunities in Las Vegas—before prices and competition climb higher.