How to discern if rising rates should affect your next home purchase.
Many people have asked us this question recently: “When will rates be going down?” The answer is simple. We have no idea.
There’s no way to definitively predict if rates will go up or down. From what we’re hearing from our lending partners, there may be some small fluctuations in rates in the coming months, but everyone generally expects rates to remain the same or possibly inch even higher. This means that if you’ve been waiting for rates to come down to purchase a home, you may be waiting a very long time. Even worse, you may find that your wait has yielded even higher rates.
We’re not trying to scare you with that information—we’re just trying to give you some perspective. All we can ever know for sure is where the market is today. If today’s rates and prices aren’t affordable for you, then it’s time to set up a strategy so that you’ll be ready to buy in the future when rates have either finally settled or you’re simply in a better financial position to make a purchase. We don’t want you to miss an opportunity because you’re stuck thinking about yesterday’s rates and holding on to the hope that they’ll be back one day when you need a house.
Now, the good thing about rates is you can refinance to a lower rate if they do come down in the future. However, if you fail to act and rates go up, you may find your dream home is just out of reach.
There is a little bit of good news out there, as many lenders have new lock-in loan programs. Traditionally, people haven’t been able to lock in their rates before they were under contract. Now, lenders will let you lock your rate while you shop, up to 120 days in advance of your close. That way you’ll know upfront what your rate will be.
If you have any questions about rates or real estate in general, don’t hesitate to reach out to us. You can call or email us anytime, we’re here for you!