You’ve taken all the necessary steps to get ready to buy a home. You’ve saved for a down payment, improved your credit score, got all your financial documentation in line, and figured out what price range you can afford. And then the interest rates had a slight increase, so stopped everything!
Don’t run off so soon. The facts are event with increases in interest rates from last year’s historic lows, the rates are still favorable for buying. According to realtor.com®’s January survey of active homebuyers, 44 percent of buyers planning to buy in spring 2017 are first-time buyers. With inventory shortages and rising home prices, the urgency to buy now has never been greater. So before you shelve your plans for buying a home this spring, know the facts about rising rates and home prices.
So what are you waiting for, another increase?
Take a cue from repeat homebuyers who are actually being spurred into action by rising rates. Even with the current increases, interest rates remain historically low, and the movement in rates hasn’t yet tipped overall buyer demand down. Experienced buyers, in fact, are trying to close before rates increase further, as evidenced by increased realtor.com® listing views and decreased inventory. In the short term, the rate movement seems to have encouraged, rather than dampened, overall demand.
While concerns about affordability are valid, waiting may not help your long-term financial picture. Instead, consider looking for a home in a slightly lower price range, finding a way to increase your down payment, or looking in a neighborhood that may be more affordable. The good news? In today’s competitive market, your home will most likely increase in value and prove to be one of the smartest investments you could’ve made.
For more information about how rising interest rates will impact your home purchase, contact me today.