Mortgage rates, which had been steadily decreasing during the winter season, have recently begun to increase. This has become a cause for concern among potential homebuyers, as the combination of higher mortgage rates and higher home prices has made buying a home less affordable. As a result, if you are planning to purchase a home this year, you may be wondering whether it is the right time to buy or if you should wait until rates go down again. The recent rise in rates is attributed to the current state of inflation, as explained by Joel Kan, the 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.”
The 30-year fixed mortgage rate, as reported by Freddie Mac in its most recent weekly average, stands at 6.5%. This marks the third consecutive week of rate increases and positions them at their highest point so far this year, as shown in the graph below:
Advice for Home Shoppers
If the recent increase in mortgage rates has made you consider pausing your home search, it may be worth rethinking that decision. In fact, this could be an opportunity to finally purchase the home you’ve been looking for. The Mortgage Bankers Association (MBA) reports a significant 13.3% decline in mortgage applications within just one week, indicating that the rise in rates is causing some potential homebuyers to hold off on their search. For you, this could mean facing less competition from other buyers when you’re in the market for a home. This is good news considering the current market has a limited supply of available homes for sale.
Bottom Line
Despite the recent rise in mortgage rates over the last few weeks, it may not be necessary to delay your plans of buying a home. In fact, it could be an opportunity to take advantage of reduced buyer competition. To explore the available options in your local market, let’s connect today.
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Sat, 04 Mar 2023 01:28:55 +0000
by Mottek Group