Mortgage Rates Rising: What Does This Mean for Home Buyers and Sellers?
Mortgage rates have been rising for the past several months. Uncertainty about whether they will continue to climb, level off, or possibly drop may have you wondering if this is a good time to buy or sell a home.
While the future of mortgage rates can’t be predicted, the following information can help you with making a decision in your sale or purchase of a home.
Buying a Home
Brian Hope, a mortgage consultant with Prosperity Home Mortgage — a full-service mortgage banker and part of The Long & Foster Companies — stresses to home buyers to choose what works for their budget.
“Rates may have gone up, but that doesn’t mean you can’t afford a house,” Hope said.
Before you start your home search, speak with your real estate agent and lender. Have open and honest discussions about what you are looking for in your future home, budget and price points, etc.
Hope also stressed that the earlier you work with a lender, the more comfortable you will be with the financial aspects of purchasing a home. Plus, by working with a lender early on, you can obtain pre-approval on a loan, which may help you in a competitive homebuying market.
What About Inflation?
If the cost of inflation is on your mind, there is a good reason to take the next step in your home buying journey.
“Purchasing is inflation proof,” Hope said. “When you purchase a home, the interest rate is never going to go any higher.”
While it is possible mortgage rates could drop after you purchase a home, you know for certain that you are locked in with the current rate at your time of purchase.
Selling Your Home
It is still a good time to sell your Reston home. As we mentioned in our May market update, we are watching for signs of a leveling off of the significant demand for homes that we have experienced in the last five years. With interest rates rising, the expectation is for less intensity, not a marked decline.
If you are a home seller who will become a home buyer, it’s also beneficial to start the mortgage conversation with your lender now. Hope stated to discuss your current home mortgage and the selling price of your home. This information will help when developing a plan and budget for your next home purchase.
Mortgage rates may be on the rise, but don’t let uncertainty prevent you from moving forward in the sale or purchase of your home.
The O’Gorman Team is here to answer questions and help you through your home buying or selling process. If you are looking for a home in Reston, contact The O’Gorman Team today!