Investing in Real Estate in a Slowing Economy with Unchanged Interest Rates

The U.S. economy is slowing, yet the Federal Reserve has kept interest rates steady, creating a mixed but opportunistic environment for real estate. With rising inventory levels and sellers becoming more negotiable, investors and buyers can find valuable opportunities in today’s market.

1. The Economic Landscape: Slower but Stable

The U.S. economy has shifted from rapid growth to a more moderate pace, impacting consumer confidence and real estate demand.

• Slower Gross Domestic Product growth signals cautious spending and investment.

• Labor market remains steady, but wage growth is easing.

• Inflation and tariffs add uncertainty, keeping the Fed on alert.

By holding rates steady at 4.25%–4.50%, the Federal Reserve is signaling patience, allowing investors and buyers to plan without worrying about immediate rate hikes.

2. Interest Rates and Housing Market Impact

Mortgage rates remain elevated, averaging around 6.7% for 30‑year fixed loans. While these rates are higher than pre‑2022 levels, their stability allows investors and buyers to plan more confidently.

• Homeowners with older, low-rate mortgages are still reluctant to sell.

• New listings are increasing, creating more options for buyers.

• Price growth is slowing, giving buyers an advantage.

3. A Shifting Market: Buyers Gain the Upper Hand

The combination of slower demand and rising inventory has led to conditions that feel closer to a buyer’s market, especially in certain price points and markets:

• Sellers are more negotiable: Price reductions, closing cost credits, and buyer incentives are becoming common.

• Inventory is increasing: More homes on the market provide buyers and investors with choices they haven’t had in years.

• Opportunities for value: Properties that linger on the market longer often allow buyers to negotiate better deals.

4. Real Estate Investment Opportunities in a Slower Economy

Economic slowdowns often create favorable entry points for investors willing to be strategic.

A. Residential Rentals and Multi‑Family Properties

• Increased affordability pressures drive more demand for rentals.

• Multi‑family properties provide steady cash flow and less vacancy risk.

B. Vacation and Second Homes

• Higher‑income buyers continue to drive activity in lifestyle markets like lakefronts and mountains.

• Investors can focus on short‑term rentals (where allowed) or seasonal leasing to maximize returns.

C. Commercial Real Estate with Stable Tenants

• Focus on essential-use properties like medical offices, grocery‑anchored retail, or logistics hubs.

• Distressed or vacant office space remains risky, but prime locations may offer discounted entry points.

5. Strategic Tips for Real Estate Investors Right Now

1. Leverage the Buyer’s Market: Negotiate price reductions, seller-paid closing costs, or even mortgage buydowns.

2. Prioritize Cash Flow: Focus on properties with strong rental potential rather than speculative appreciation.

3. Diversify: Mix residential, vacation, and commercial investments to balance risk.

4. Watch Inventory Trends: Rising listings often translate to better deals and higher negotiating power.

5. Stay Prepared: Have financing ready, as the best deals often go to ready-to-move buyers and investors.

6. The Bottom Line

In today’s slower economy with stable interest rates, the market is quietly shifting in favor of buyers and strategic investors. Rising inventory and motivated sellers mean more negotiating power and better opportunities than we’ve seen in recent years.

For investors, this is a time to acquire quality properties at fair values, secure long-term cash flow, and position portfolios for future growth when the market accelerates again.

Contact Melissa to help find the perfect investment property for you!

870-557-9165

Short‑Term vs. Long‑Term Rentals: How Each Affects Our Local Community

The rise of short‑term rentals (STRs) like Airbnb and Vrbo has transformed the way people travel and invest in real estate—especially in vacation destinations like Hot Springs, Lake Ouachita, and the Ouachita Mountains. While these rentals create new opportunities for property owners and tourists, they also have significant effects on the local community, especially when compared to traditional long‑term rentals (LTRs).

In this post, we’ll break down the differences between STRs and LTRs, and explore how each affects housing availability, affordability, and the local economy.

1. Short‑Term Rentals (STRs)

Short‑term rentals are typically properties rented out for less than 30 days at a time, often to vacationers or business travelers.

Benefits for the Local Economy:

• Boosts Tourism Revenue: STRs attract out‑of‑town visitors who spend money on dining, entertainment, and local attractions.

• Higher Income for Owners: Hosts can often earn more per night than with a traditional long‑term lease, especially in peak seasons.

• Encourages Property Improvements: Many owners renovate or upgrade their homes to appeal to travelers, which can improve property values.

Challenges for Locals:

• Reduced Housing Availability: When more homes are used for STRs, fewer are available for families and local workers to rent long term.

• Higher Housing Costs: Limited rental supply can drive up both rent and home prices for locals.

• Neighborhood Impact: Increased turnover can mean more traffic, noise, and a “less residential” feel for neighbors.

2. Long‑Term Rentals (LTRs)

Long‑term rentals are properties leased for six months to a year (or more) to tenants who make the community their home.

Benefits for the Local Community:

• Stabilizes Neighborhoods: Permanent residents help maintain a sense of community and support local schools, clubs, and events.

• Reliable Housing Supply: LTRs ensure local workers, retirees, and families can find homes near their jobs and schools.

• Steady Income for Owners: While usually lower than STR revenue, long‑term leases offer consistent cash flow without seasonal dips.

Challenges for Owners:

• Lower Revenue Potential: LTRs often earn less annually than STRs in vacation markets.

• Tenant Turnover Risks: Evictions, damages, or vacancies can still disrupt cash flow.

• Less Flexibility: Landlords can’t use the property themselves on short notice.

3. How This Plays Out in Our Area

In Hot Springs, the demand for STRs has surged over the last few years, bringing both benefits and growing pains:

• The city has capped residential STR licenses at 400 and is not issuing new permits in residential zones (as of July 2025) to help stabilize neighborhoods.

• Local families have voiced concern about finding affordable long‑term housing, as homes are increasingly used for weekend visitors.

• Around Lake Ouachita, STRs remain popular and profitable, but balance is essential to keep our community welcoming to both locals and tourists.

Takeaway: A healthy mix of STRs and LTRs is crucial. Overreliance on STRs can reduce housing options for locals, while LTRs alone may limit tourism‑driven revenue opportunities.

4. Tips for Property Owners

• Consider a Hybrid Approach: Some owners offer seasonal short‑term rentals in summer and long‑term leases in the off‑season.

• Know Local Rules: Stay updated on Hot Springs STR permits and county zoning rules before investing.

• Be a Good Neighbor: Whether STR or LTR, maintaining property standards and respecting the community ensures sustainable growth.

5. Conclusion

Short‑term and long‑term rentals each play a vital role in our local economy and housing market. STRs drive tourism and revenue, while LTRs keep our community livable and connected. By understanding the impact of each and working within local guidelines, property owners can maximize their investment while supporting a thriving, balanced community.

Dreaming of a Vacation Home?

Here’s What You Need to Know First

Owning a vacation home near the serene waters of Lake Ouachita or nestled in the Ouachita Mountains sounds like a dream—and for many, it can be. But before you take the plunge, it’s important to know what to look for and what to expect. As a local real estate expert based in Mount Ida, Arkansas, I help buyers make smart, stress-free decisions when it comes to purchasing second homes and vacation properties.

Whether you're planning weekend getaways, retirement retreats, or rental income, here’s what to keep in mind:

1. Know Your Why

Before you start searching, get clear on your reason for buying:

• Personal Use – Will this be a seasonal family getaway?

• Retirement Planning – Do you hope to live here full-time in the future?

• Rental Potential – Are you planning to use the home as a short-term rental?

Your "why" will shape everything—from the location and size to amenities and financing.

2. Location is Everything

When it comes to vacation homes, the right location matters more than ever. Ask yourself:

• How close is the property to lakes, hiking, or attractions?

• Is the area quiet and relaxing, or vibrant and active?

• What’s the seasonal weather like?

In the Arkansas region—especially around Lake Ouachita and Mount Ida—buyers love easy access to water, trails, and small-town charm. I always recommend visiting in different seasons if possible.

3. Understand the Costs

Vacation homes often come with hidden costs, such as:

• Higher insurance premiums (especially near lakes or in rural areas)

• Maintenance and upkeep (think landscaping, HVAC, pest control)

• Furnishing and stocking the home

• Property management or cleaning services (if renting)

Budget for more than just the mortgage—you’ll want to enjoy your retreat, not worry about surprises.

4. Financing Can Be Different

Lenders view vacation homes differently from primary residences. Be prepared for:

• Stricter loan requirements

• Higher down payments (often 10–20% or more)

• Possible need for proof of rental income if you’re financing as an investment property

Need help connecting with local lenders? I can recommend trusted professionals who understand vacation home financing.

5. Don’t Skip the Inspection

Even if it’s love at first sight, a professional home inspection is a must. Vacation homes, especially cabins or properties near water, may face:

• Water damage or flooding risk

• Foundation issues

• Septic or well complications

A thorough inspection ensures peace of mind and protects your investment.

6. Check the Rules and Restrictions

Every area is different—some neighborhoods or counties have restrictions on:

• Short-term rentals (like Airbnb)

• Boat docks or water access

• Future renovations or expansions

I help buyers review HOA guidelines, and any permits required before committing.

7. Work With a Local Expert

Buying in an unfamiliar area means having someone on your side who knows the local landscape, market trends, and potential pitfalls. Living here all my life, and working in the public and real estate many years, I’m here to guide you every step of the way.

Thinking of Buying a Vacation Home in Arkansas?

Let’s find the perfect spot for you—whether it’s a lakeside condominium, a cozy mountain cabin, or a peaceful hideaway in the woods. Reach out today for a free consultation, and let’s make your vacation dreams a reality!

How to Get Pre-Approved for a Mortgage (First-Time Buyer Guide)

🏡 Thinking about buying your first home? Before you start touring properties or scrolling Zillow for hours, there’s one smart step you don’t want to skip: getting pre-approved for a mortgage.

Mortgage pre-approval gives you a clear idea of how much home you can afford—and shows sellers you're serious. In a competitive market, it’s your ticket to standing out.

💡 What Does Pre-Approval Even Mean?

Pre-approval is when a lender reviews your financial information and conditionally agrees to lend you a specific amount. It’s not a guarantee, but it’s a major step toward getting a mortgage.

✅ You’ll receive a pre-approval letter, which you can include with offers to show sellers you’re ready to buy.

✅ Why Getting Pre-Approved Matters

• Know your budget before you fall in love with a home

• Speed up the buying process when you're ready to make an offer

• Strengthen your offers in competitive markets

• Spot potential credit or income issues early

🔑 Step-by-Step: How to Get Pre-Approved for a Mortgage

1. Check Your Credit Score

Your credit score impacts what type of loan you qualify for and your interest rate.
📊 Aim for 620+ (minimum for most loans), but 740+ gets you the best rates.
👉 Tip: Check your credit report for errors before applying.

2. Gather Financial Documents

Lenders will ask for:

• Pay stubs (last 30 days)

• W-2s or 1099s (last 2 years)

• Bank statements (last 2–3 months)

• Tax returns (last 2 years)

• ID (like a driver’s license)

🗂 Being organized = a faster process.

3. Choose a Mortgage Lender

You can apply through:

• A bank or credit union

• A mortgage broker

• Online lenders (Rocket Mortgage, Better.com, etc.)

📞 Tip: Compare interest rates, fees, and reviews before deciding.

4. Complete a Mortgage Application

You’ll fill out a form called a Uniform Residential Loan Application. It includes personal, employment, and financial info.

💬 Be honest! Inaccurate info can delay or deny your loan.

5. Get Your Pre-Approval Letter

If you qualify, your lender will issue a pre-approval letter—usually valid for 60–90 days.

🏡 Now you can house hunt with confidence!

🧠 Extra Tips for First-Time Buyers

• Don’t open new credit cards or make large purchases during the process

• Avoid switching jobs before closing

• Keep your debt-to-income ratio low

📝 FAQ: What’s the Difference Between Pre-Approval and Pre-Qualification?

• Pre-qualification is a quick estimate based on self-reported info

• Pre-approval is more in-depth and verified by a lender

💡 Sellers usually want to see pre-approval over pre-qualification.

🎯 Final Thoughts: Be Ready Before You Shop

Getting pre-approved is one of the smartest first steps in your home buying journey. It gives you a budget, builds confidence, and sets you up for success.

👉 Ready to get started?

If you're thinking about buying your first home and want help connecting with a trusted lender—or just have questions—I'm here to help!

📲 Contact me today for first-time buyer support, trusted resources, and next steps.

7 Proven Steps to Sell Your Home Faster

🏡 Ready to move but want to sell your home quickly? In today’s competitive market, making a strong first impression is key. Whether you're upsizing, downsizing, or relocating, these 7 proven steps will help you sell your house faster—and often, for more money.

1. Price It Right From the Start

Overpricing can cause your home to sit on the market. Research your local housing market or work with a trusted real estate agent to determine a competitive, accurate listing price that attracts serious buyers from day one.

2. Boost Your Curb Appeal

First impressions matter. Mow the lawn, add fresh mulch, trim hedges, and repaint your front door. Buyers often decide how they feel about a home within the first few seconds of arrival.

3. Declutter and Deep Clean

A spotless, clutter-free space feels bigger and more inviting. Pack away personal items, clean every corner, and consider hiring a professional cleaning service before showings.

4. Stage Your Home for Success

Home staging highlights your home's strengths and helps buyers visualize living there. Rearrange furniture, add neutral décor, and brighten up rooms with lighting or mirrors.

5. Hire a Local Real Estate Expert

A local agent knows the market, pricing trends, and buyer behavior. They’ll market your home, negotiate offers, and keep the process on track—helping you sell faster and with confidence.

6. Use Professional Photography

Most buyers start their search online, so high-quality images are a must. Showcase your home’s best features with bright, sharp photos that tell a story.

7. Market Smart—Everywhere

Your home should be listed on major platforms like Zillow, Realtor.com, and your agent’s website. Use social media, email marketing, and even local community groups to reach more eyes.

🏁 Final Thoughts: Ready to Sell Fast?

Selling your home doesn't have to be stressful. By following these 7 simple steps, you'll create a polished, buyer-ready home that attracts attention and sells faster.

Need help preparing your home for sale in Mount Ida, Glenwood, Hot Springs, or Montgomery County, AR? Contact Melissa Carmack at Caddo River Realty—your trusted local real estate expert.

Renting vs. Buying: Which is Right for You?

🏡 Trying to decide whether to rent or buy a home? You’re not alone. With rising costs, interest rates, and changing lifestyles, the choice isn’t always black and white.

Here’s a quick breakdown to help you make a confident move:

🔑 Why Rent?

• ✅ Lower upfront costs — no down payment, no property taxes

• ✅ Flexibility — easy to move, perfect for short-term plans

• ✅ No maintenance stress — landlords handle repairs

Best for: people who want freedom, are new to an area, or are building savings.

🏠 Why Buy?

• ✅ Build equity — your payments go toward ownership, not rent

• ✅ Long-term investment — home values can grow over time

• ✅ Customize your space — no landlord rules on upgrades or pets

Best for: those ready to settle down, build wealth, and lock in stable payments.

💬 Final Thought

There’s no one-size-fits-all answer. Your choice depends on your budget, lifestyle, and goals. Want help deciding? I’m here to guide you through the process, no pressure.

Try this calculator to see what is best for you!

📲 Contact me today to explore your options!

How to Build Home Equity Faster (Without Breaking the Bank)

🏠 Buying your first home is a major milestone—but it’s also a smart financial move. Why? Because every mortgage payment helps you build home equity—aka, the portion of your home that you truly own. But did you know there are ways to build equity faster and maximize your investment?

Whether you’re a first-time buyer or just getting started with homeownership, here are simple and effective ways to grow your equity and boost your net worth.

💡 First, What Is Home Equity?

Home equity = your home’s market value – what you still owe on your mortgage.
So, if your home is worth $300,000 and you owe $240,000, you have $60,000 in equity.

The more equity you have, the more financial freedom you can access—like tapping into it for renovations, emergencies, or future investments.

⚡ 6 Ways to Build Equity Faster

1. Make Extra Mortgage Payments

Even one extra payment per year can shave years off your loan and save thousands in interest. Consider:

• Making biweekly instead of monthly payments

• Rounding up your monthly payment

• Putting bonuses or tax refunds toward your principal

2. Opt for a Shorter-Term Loan

A 15-year mortgage builds equity faster than a 30-year one, though monthly payments are higher. If you can swing the budget, it’s a powerful way to save long-term.

3. Put More Down at the Start

If you’re still house-hunting, remember: a larger down payment = instant equity. Even 10%–20% down makes a big difference.

4. Avoid Private Mortgage Insurance (PMI)

If you can put down 20%, you skip PMI—saving hundreds per month, which you can redirect toward your loan principal.

5. Make Smart Home Improvements

Renovations like kitchen upgrades, energy-efficient windows, or bathroom remodels can boost your home's market value and, in turn, your equity. Just don’t overdo it—focus on ROI-friendly projects.

6. Let the Market Work for You

If your local market is appreciating, your home’s value may increase on its own. Keep an eye on trends, and consider refinancing when your loan-to-value ratio improves.

📈 Equity = Power

The more equity you have, the more flexibility you gain. You can:

• Refinance at a better rate

• Open a HELOC (home equity line of credit)

• Sell and walk away with cash for your next home

Building equity isn’t just about owning a home—it’s about building wealth.

🧠 Pro Tip for First-Time Buyers

Start small: even rounding up your payment by $100/month can significantly speed up your equity gains over time. Think of it like a savings account with long-term benefits.

🛠️ Final Thoughts: Build Equity on Your Terms

Building equity doesn’t mean living lean or stressing over every penny. It’s about using smart strategies and making your home work for you. With a few intentional moves, you can fast-track your equity—and your financial future.

👉 Need help planning your next move?

Whether you’re buying your first home or looking to grow your investment, I’m here to help you make informed decisions every step of the way.

📲 Contact me today to talk about your homeownership goals!