January is a good moment to think if 2018 is the year to buy a house, but maybe you wonder: Should I buy a Home when interest rates are rising? Continue reading to understand that 2018 is time to buy a home in Miami
Freddie Mac Report
U.S. mortgage rates rose this week for a third week in a row, lifted by investors’ expectations for faster economic growth, which has pushed up borrowing costs.
Mortgage giant Freddie Mac said Thursday that the rate on 30-year, fixed-rate mortgages rose to 4.15 percent this week from 4.04 percent. That is the highest since March.
The rate on 15-year fixed-rate mortgages, which are popular with homeowners who are refinancing, rose to 3.62 percent, also the third straight increase.
Signs of faster economic growth have also lifted concerns that inflation may quicken and the Federal Reserve will raise short-term interest rates more quickly to keep price increases in check. That has driven up the yield on the 10-year Treasury note. Mortgage rates track the yield on the 10-year.
Last year was the best year for home sales in over 10 years. The news became official when existing home sales for the month of December were finally announced.
For home buyers in 2018, this was part of the reason mortgage rates jumped to the highest levels since March of last year.
Over the past week, mortgage rates increased to 4.15%, a huge jump of 11 basis points (0.11%) from the previous week.
Rates had been hovering around the four percent level for a while, but last week’s rise in rates all but ends that trend.
It seems unlikely that mortgage rates are going to be dropping anytime soon, given that the economy and housing market are both going strong. Now, home buyers are going to have to move forward while dealing with higher rates.
But higher rates doesn’t mean that homes are no longer affordable.
For those still looking for a home, it’s worth considering that current rates are still relatively low when compared to historic rates.
Also, home prices might be rising across the country, but not all areas are seeing spike in home prices. Shopping around for the right home can easily lead to a lower monthly payment.
There’s also still a chance that mortgage rates can decrease over the coming days and weeks. Those looking for the best rates possible should keep their eye on rate trends while continuing their home search.
Design your Mortgage Strategy
There are a lot of positive factors at play in the economy. First, the Fed is starting to get more comfortable with current conditions. Second, the housing market is growing strong. Third, unemployment is holding low, and wages are increasing.
If there are any significant problems with the current economy and housing market, they are hard to find. The positives outweigh most of the negatives. This includes rising rates, which not everyone would see as a negative.
With rates rising, some would-be home buyers might get deterred from purchasing a home. This would make it easier to find an available house – something that has been difficult in the current housing shortage.
Also, current rates might seem high, but they’re more than likely going to move to even higher levels at some point this year.
It’s important for home buyers to put things into perspective. Things are going well, and higher rates are the result of that. But rates still aren’t very high, and home prices will still increase even after the home is purchased.