Think Twice Before Holding Out For Lower Mortgage Rates

Minneapolis, MN:  Inflation is hitting everyone every way we turn. The Federal Reserve early in 2022 starting taking steps to attempt to slow down the pace of inflation. Their main tool is to raise the cost of borrowing, which no one likes, but does tend to work.

Coming off of historically low mortgage interest rates, today’s rates seem very high, although in a historical perspective, they are not.  January 2022, a typical 30-yr fixed was about 3.00%, by March it was 4.50%, and it peaked at over 7% in Oct 2022.  You can click here to see today’s national mortgage interest rate averages.

Mortgage rates have come down already, and inflation is starting to come down. This is great news for homebuyers, as any drop in rates eases the payment or increases your buying power,  yet many hopeful buyers are remaining on the sidelines, waiting for them to come down more.

Interest Rate Forecast

It is important to have a realistic expectation of the short-term future of mortgage rates.  We are NOT going back to 3% anytime soon, and inflation is NOT going back to 2% anytime soon.  The best I’ve seen from the market guru’s in for rates to maybe get slightly lower than today over the next few months, and maybe into the lower 5’s or upper 4’s in mid 2024. Of course no one has the magic crystal ball, but these projections are very realistic.

Home Prices

Even with the lower demand for homes because of the higher interest rates, we still have a housing shortage.  Home prices continue to go up, although at a slower pace than the past couple of years.  You can always refinance any loan you get today when interest rates drop, but you can’t renegotiate the price you paid for the house later.  Waiting for a lower interest rate can easily be wiped out by having to pay more for the house, and important equity gains.

Should You Buy Today?

Yes. The old saying is the best time to buy a house was 5-years ago stands true.  If you wait today, you’ll be kicking yourself in the future. Waiting for Mortgage rates to come down may cost you more money in the long run than buying now and refinancing later

Ready to Get Started?

We make it easy. Simply call us at (651) 552-3681, or click HERE to APPLY online, or to Schedule and Appointment.  We’ll review your credit, income, assets and goals so that you know how much house you can afford. Once we know what you qualify for, we’ll review your pre-approval letter with you and the listing agents to help get your offer accepted sooner.