Search

Mortgage rates just dropped to a 2-month low. Here's why you may want to buy now. - CBS News

singkrata.blogspot.com
gettyimages-468993291.jpg
Mortgage rates recently hit a 2-month low.  Getty Images

Mortgage rates have been elevated as of late. Driven by the Federal Reserve's attempts to curb inflation with federal funds rate hikes, the average 30-year mortgage rate peaked at 7.79% on October 26, 2023, according to the Federal Reserve Bank of St. Louis. And, while mortgage rates have seen quite a bit of movement since, they seem to be cooling. 

In fact, the current average 30-year mortgage rate is at a 2-month low. And, that could be a signal that now is the time to buy a new home. After all, low mortgage rates typically result in lower monthly payments and a lower overall cost of homeownership

Accounting for the new change in rates, we asked multiple experts if now is the right time to buy a house. And, those we asked agreed that it could be. Find out why below. 

Compare mortgage rates among leading lenders now

Why you may want to buy a house now

There are multiple factors to consider when you decide if it's time to buy a new home. Here's why now could be a smart time to act, according to the experts we spoke with: 

Lower mortgage rates can give you more options 

Lower mortgage rates can decrease the cost of homeownership. "Mortgage rates have decreased since the highs in late 2023," explains Ronnie Thompson, investment advisor representative and owner of True North Advisors, a financial planning firm. "The interest costs on a mortgage for a home are currently at a two-month low."

And, a reduced cost of ownership could open the door to more options. "Lower interest rates improve housing affordability and increase buying power," explains Michael Ross, area manager at Mutual of Omaha Mortgage. That increased buying power may mean you have access to options that you couldn't afford previously. 

But, lower mortgage rates aren't the only reason now may be the time to shop for a new home. 

Take advantage of today's reduced rates by locking in your mortgage now

Increasing inventory could lead to lower prices

Supply and demand play a meaningful role in the price of just about anything - homes are no different. And, inventories are increasing in some markets, which can work in your favor. 

"Many markets are experiencing longer market times and higher inventory levels," says Ross. This means buying now could result in "more choices and potentially better negotiating power."

"Inventory for homes is increasing, which has led to them staying on the market longer and, in turn, market prices are decreasing," says Thompson in agreement with Ross. 

Further potential negotiation leverage

The average homeowner in the United States has more than $200,000 in tappable home equity. And, that high equity average may mean that now is the time to buy. 

"Many homes are equity rich," explains Dutch Mendenhall, CEO of RADD Companies, a conglomerate of financial services companies. He says that high amounts of equity could provide negotiation leverage.

After all, a homeowner may be more likely to negotiate the selling price of their home if they have quite a bit of equity to work with. Conversely, there may be less room for negotiations if the homeowner owes nearly what they list the house for. 

Buying a home isn't just a financial move

While all the factors above suggest that it's a good time to buy a home, you should consider more than finances when you house hunt. "I always tell clients that buying what should be your 'dream home' is more than a financial move," explains Steve Azoury, ChFC and owner of the financial planning firm, Azoury Financial. "You are there every day of your life, and you want to love it, not just like it."

So, it may be a good idea to put interest rates, inventory levels and equity levels aside. If you find the house of your dreams, it may be time to buy - regardless of the current market conditions. "There's really no perfect time to buy a house," says Azoury. "But if you purchase a new home now, you'll likely want to refinance if and when interest rates go down." 

Get pre-approved for a mortgage to make an offer on your dream home

The bottom line 

30-year mortgage rates are currently at a 2-month low. That, combined with increasing inventories and higher equity amounts could make now a good time to buy a home - especially if you consider the financial aspects of doing so. But, buying a home isn't solely a financial decision. It's also important to ensure that the home you purchase is one you'd like to live in. 

Find out how affordable your home purchase could be now

Adblock test (Why?)



"low" - Google News
June 29, 2024 at 12:32AM
https://ift.tt/3ueGd1n

Mortgage rates just dropped to a 2-month low. Here's why you may want to buy now. - CBS News
"low" - Google News
https://ift.tt/hwIKlf4


Bagikan Berita Ini

0 Response to "Mortgage rates just dropped to a 2-month low. Here's why you may want to buy now. - CBS News"

Post a Comment

Powered by Blogger.