Mortgage rates have been going up in recent weeks after going down steadily all winter. Some people who want to buy a home are worried about this because higher prices and higher mortgage rates have made homes less affordable. So, if you want to buy a home this year, you may be wondering if now is the right time to buy or if you should wait until rates go down again.
What’s going on with inflation is what’s behind the recent rise in rates. Joel Kan, Vice President and Deputy Chief Economist at the Mortgage Bankers Association (MBA), says:
“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 says that the average 30-year fixed mortgage rate for the past week is 6.5%. Rates have gone up for three weeks in a row, and they are now at their highest point of the year (see graph below):
Advice for Home Shoppers
If you want to stop looking for a home because interest rates have started to go up again, you might want to think again. This could be the chance you’ve been waiting for to buy the house you’ve been looking for. The number of mortgage applications dropped by 13.3% in just one week, according to the MBA. This suggests that rising mortgage rates are making some potential homebuyers stop looking for a new home.
So, how does that affect you? If you keep looking for a home, you’ll probably have less competition from other buyers. This is good news in a market where there aren’t many homes for sale.
Mortgage rates have gone up over the past few weeks. But you shouldn’t put off your plans to buy a home because of this. If you want to take advantage of less competition from other buyers, it could mean the opposite. Let’s get together today to talk about what’s available in our area.