U.S. homebuyers, already contending with escalating prices, now are getting hit with the most-expensive mortgage rates in seven years. Funny thing: It’s only making them move faster.
The average rate for a 30-year fixed mortgage jumped to 4.61 percent, up from 4.55 percent last week and the highest since May 2011, Freddie Mac said in a statement Thursday. And homes that sold last month went into contract after a median of 36 days on the market – a record speed in data going back to 2010, according to a new report by brokerage Redfin Corp.
“This is what happens when the economy is strong,” Sam Khater, Freddie Mac’s chief economist, said in a phone interview. “All the higher-rate environment does is it either causes them to try and rush or look at different properties that are more affordable.”
The mortgage rates were low and historic by the extra-ordinary low fed rate maintained during Obama period.
For next 6 to 8 years, Rep. will he on helm and normally they do not resort to reducing the rate.
Like Short sale is history in USA, low fixed mortgage is going to be history in USA.
For ARM holders,esp primary home buyers/owners, it is not too late to lock in the fixed rate at 4.25% as this rate will also he a historical low in future.
Go for fixed mortgage…get rid of ARM at this stage…even if your ARM expires after 2 or 4 years.
GO FIXED, save yourself in the long run. It is up to you to analyze, decide, secure and save.
Looking to reduce interest rate and being defensive is good, but it’s much better and will pay off even more in the long run if you can leverage your home equity to buy stocks on the offensive.
Btw, I bought in 2015. Yes, market went sideways at least for a few months then. But prices are up 50% since then.
Also gotta see when people realize they will pay more(indirectly) for house purchase this year especially for high house price places such as Bay Area and what effect that has. Maybe some people will realize only when they file their taxes next year.
I’m salivating at discounted prices coming our way. I’ve got my eye on a nice property in PA. I’m guessing 25-40 discount. 60 of 8M means a 4.8 price then I’ll get equity 6 months later.
All the fundamentals are still pointing upwards for housing in BA. Sometimes buyers need a breather and for them to internalize the true market price. This is healthy for the market and prices will go up higher afterwards.
