What You Should Know About Rising Mortgage Rates
Mortgage rates have begun to rise in recent weeks after steadily falling throughout the winter. Some prospective homebuyers are concerned because the combination of higher mortgage rates and higher prices has made homes less affordable. So, if you're looking to buy a home this year, you may be wondering if now is the time to buy or if you should wait until interest rates fall.
The recent rate hike has been driven by the state of inflation. According to Joel Kan, Vice President and Deputy Chief Economist at the Mortgage Bankers Association (MBA),
“Mortgage rates increased across the board last week, pushed higher by market expectations that inflation will persist, thus requiring the Federal Reserve to keep monetary policy restrictive for a longer time.”
Freddie Mac's most recent weekly average 30-year fixed mortgage rate is 6.5%. Rates have risen for the third week in a row, bringing them to their highest level this year (see graph below):
Advice for Home Buyers
If you're considering putting your home search on hold because interest rates have begun to rise again, you should think twice. This could be your chance to buy the house you've been looking for. According to the MBA, mortgage applications fell 13.3% in a single week, indicating that rising mortgage rates are causing some potential homebuyers to postpone their search for a new home.
So, how does this affect you? If you stick with it, you'll likely face less competition from other buyers when looking for a home. This is a welcome relief in a market with so few available homes.
Mortgage rates have risen in recent weeks. But that doesn't mean you should postpone your home-buying plans. In fact, if you want to take advantage of less buyer competition, it could mean the opposite. Let's get together today to discuss our options in our local market.
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