Recently, we’ve been getting a lot of questions about interest rates and the impact they have on the market.
The first thing to note is that the Fed has raised rates on overnight loans from bank to bank. This is significantly different from mortgage rates, but this has caused mortgage rates themselves to creep up as well.
The good news is that mortgage rates are still at 45- to 50-year lows. Rates right now are, on average, in the 4.25% to 4.5% range. However, this does mean that monthly payments are currently more expensive than they were when we saw rates of 3.3%. If you’re looking at a $300,000 home in this market, the difference between a rate of 3.3% and a rate of 4.5% is about $127 per month.
Still, it’s important to keep in mind that current rates are still very attractive. The average rate for the last 60 years is about 8.5%. Buying power today is still much higher today than it has been for much of the last 50 years.
Also, these rates refer to fixed-rate loans. This means that buying a home today at 4.5% is still an incredibly wise move since rates are set to rise even higher. Now is a great time to lock in our still-low rates.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.