Mortgage rates have been back on the rise recently, and that’s getting a lot of attention from the press. If you’ve been following the headlines, you may have even seen rates recently reached their highest level in over two decades (see graph below):
That can feel like a gut punch if you’re considering moving. If you’re wondering whether or not you should delay your plans, here’s what you need to know.
How Higher Mortgage Rates Impact You
There’s no denying mortgage rates are higher now than in recent years. And, when rates are up, that affects overall home affordability. It works like this. The higher the rate, the more expensive it is to borrow when buying a home. That’s because, as rates trend up, your monthly mortgage payment for your future home loan also increases.
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.”
Some people put their plans on hold because of the current mortgage rates. But what you want to know is: is that a good strategy?
Where Will Mortgage Rates Go From Here?
You’re not alone if you’re eager for mortgage rates to drop. A lot of people are waiting for that to happen. But here’s the thing. No one knows when it will. Even the experts can’t say with certainty what will happen next.
Forecasts project rates will fall in the months ahead, but the latest data says rates have been climbing lately. This disconnect shows just how tricky mortgage rates are to project.
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 the future 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, build a team of skilled professionals, including a trusted lender and real estate agent, who can explain what’s happening in the market and what it means for you. If you need to move because you’re changing jobs, want to be closer to family, or are in the middle of another big life change, the right team can help you achieve your goal, even now.
Key Takeaway
The best advice for your move is: don’t try to control what you can’t control – especially mortgage rates. Even the experts can’t say for certain where they’ll go from here. Instead, focus on building a team of trusted professionals to keep you informed. When you’re ready to get the process started, let’s connect.
Other educational articles about the market and your home search are under Karen’s Blog. Additionally, explore the search bar for other topics of interest.
