Lexington, KY - Sellers Market but interest rates loom

[Aaron Vargas]

My wife and I are looking to make our first investment purchase in Lexington, KY. Lexington is actually a little bit of a hidden gem. Home to the University of Kentucky and lots of growth in the past five years. We have been looking at a few duplex properties, which are going quickly in the area.

Here is the issue we are facing... Prices in Lexington seem to be slightly inflated. Since real estate is going so quickly, lots of sellers are getting their listing prices or close to it even though lots of properties are over priced. My wife and I obviously do not want to overpay for a property, but at the same time, interest rates are on the rise. 

Here's our question... Do we lessen our standards on purchase price (be willing to pay more) to avoid waiting too long and getting stuck with a higher interest rate?

I know that's tough to answer without the specifics of an investment property, but any guidance would be much appreciated, especially since this is our first purchase.