Will Higher Mortgage Rates Continue to Rise?
Mortgage rates have lately begun to climb, which has gotten a lot of news attention. If you've been paying attention, you might have noticed that rates just reached their highest level in almost two decades (see graph below):
If you're thinking about making a move, that might seem like a stomach punch. Here's what you actually need to know if you're debating whether or not to postpone your plans.
How Higher Mortgage Rates Impact You
Mortgage rates are unquestionably higher currently than they have been in prior years. When interest rates rise, it impacts total housing affordability. It operates as follows. Borrowing money to buy a property becomes more expensive as the interest rate rises. That's because if interest rates rise, so will your monthly mortgage payment for your future house loan.
Urban Institute explains how this is impacting buyers and sellers right now:
“When mortgage rates go up, monthly housing payments on new purchases also increase. For potential buyers, increased monthly payments can reduce the share of available affordable homes . . . Additionally, higher interest rates mean fewer homes on the market, as existing homeowners have an incentive to hold on to their home to keep their low interest rate.”
Because of the current state of mortgage rates, some consumers have decided to postpone their plans. But you want to know if that's a solid plan.
Where Will Mortgage Rates Go from Here?
You're not alone in your desire for mortgage rates to fall. Many individuals are hoping for it to happen. But here's the deal. No one knows when it will happen. Even the experts are unsure of what will happen next.
Forecasts predict that rates will decline in the next few months, while recent statistics show that rates have been rising. This disparity demonstrates how difficult it is to forecast mortgage rates.
The best advice for your move is this: don’t try to control what you can’t control. This includes trying to time the market or guess what the future holds for mortgage rates. As CBS News states:
“If you're in the market for a new home, experts typically recommend focusing your search on the right home purchase — not the interest rate environment.”
Instead, focus on assembling a team of qualified specialists, including a reliable lender and real estate agent, who can explain what's going on in the market and what it means for you. If you need to relocate because you're changing jobs, want to be closer to family, or are in the midst of another major life upheaval, the correct team can assist you even now.
The greatest advise for your relocation is to avoid trying to influence what you can't, particularly mortgage rates. Even the experts are unsure where they will go from here. Instead, concentrate on assembling a team of reliable specialists who can keep you informed. Let's talk when you're ready to begin the process.