Today's low mortgage interest rates won't last forever! A 1% increase in interest rates would mean a 10% increase in your monthly payment.
Since the housing collapse 10 years ago, the U.S Federal Reserve has maintained a loose monetary policy, keeping interest rates low and providing easy access to credit. But with the economy nearing full employment and corporate America raking in record profits, the Fed’s policy is tightening.
After years of a fixed 30-year mortgage interest rate below 4 percent, that rate is now 4.5 percent. Anxiety over rising interest rates was one of the factors that caused the recent stock market swings, and it’s only a matter of time before rising rates seep into the housing market.
For prospective homebuyers, rising rates might put some pressure on finding a home sooner than later, as rates are unlikely to get better than they are now. We have heard that 21 percent of respondents said rates passing 5 percent would increase the urgency to buy a home, 27 percent said they’d slow their search to see if rates come back down, and just 6 percent said they’d cancel their search for a home altogether because of rising rates. A sense of urgency would be justified because the lower the rate a homebuyer can lock into, the easier it’ll be to make a monthly payment. For a homeowner with a variable-rate mortgage, rising rates would lead to suddenly higher mortgage payments.
Now is the time to seize this moment before it passes! If you or anyone you know is interested in taking advantage of the opportunity of a lifetime for buying, trading up or investing in real estate, we can help! Text or call our listing line at 830-743-0464! We will be happy to provide a comparative market analysis indicating your homes current market value so you can make an informed decision. A lot of buyers will be getting off the fence to purchase before rates go up further.