Last week’s coming soon listings became this week’s new listings as new listings jumped up again this week following the spring holidays. Pending sales will likely pop up again next week as those new listings accept offers. Expect showings to pop up again next week.
There has been much talk about how the rising mortgage interest rates are affecting buyers. It is a very real concern because it impacts buyer purchasing power. If you are planning to buy and haven’t checked in with your lender lately, now is the time to check and see if you must look in a different price category. We have been so spoiled by such low interest rates the last few years it is hard to imagine rates inching up to 5%… but keep in mind that is still below the average rate of 7.89% between April 1971 and December 2020.
Read more about it in the post below from our blog at Keeping Current Matters.
Sharlene Hensrud, RE/MAX Results – shensrud@homesmsp.com
How To Approach Rising Mortgage Rates as a Buyer
In the last few weeks, the average 30-year fixed mortgage rate from Freddie Mac inched up to 5%. While that news may have you questioning the timing of your home search, the truth is, timing has never been more important. Even though you may be tempted to put your plans on hold in hopes that rates will fall, waiting will only cost you more. Mortgage rates are forecast to continue rising in the year ahead.
If you’re thinking of buying a home, here are a few things to keep in mind so you can succeed even as mortgage rates rise.
How Rising Mortgage Rates Impact You
Mortgage rates play a significant role in your home search. As rates go up, they impact how much you’ll pay in your monthly mortgage payment, which directly affects how much you can comfortably afford. Here’s an example of how even a quarter-point increase can have a big impact on your monthly payment (see chart below):
With mortgage rates on the rise, you’ve likely seen your purchasing power impacted already. Instead of delaying your plans, today’s rates should motivate you to purchase now before rates increase more. Use that motivation to energize your search and plan your next steps accordingly.
The best way to prepare is to work with a trusted real estate advisor now. An agent can connect you with a trusted lender, help you adjust your search based on your budget, and make sure you’re ready to act quickly when it’s time to make an offer.
Bottom Line
Serious buyers should approach rising rates as a motivating factor to buy sooner, not a reason to wait. Waiting will cost you more in the long run. Let’s connect today so you can better understand your budget and be prepared to buy your home even before rates climb higher.