First, let me start off by stating … I am in no way, shape or form a mortgage representative.  I have been a Realtor for 19+ years, working with buyers and sellers assisting them to achieve their real estate goals … so it is from that perspective I speak.   

With all indicators pointing towards the rise of interest rates this year, there are a few things you should be mindful of if you are in the market to purchase a home.  While interest rates are predicted to rise in 2022 … it is important to put that into perspective.  The average 30-year fixed rate mortgage is currently at about 3.0%.  I repeat … the average 30-year fixed rate mortgages are currently at about 3.0%.  The prediction is that they are expected to inch their way up to about 3.75% by years end.   Mortgage rates are and have been at an all-time low, which has given buyers more buying power to purchase a home.  It is most buyers perspective, that if I save” more, towards my downpayment, I can “afford more,” but in this case … not necessarily. Important fact: Statistics will show that higher/lower interest rates will affect your monthly payment more so over then the amount of your downpayment. With interest rates inching their way up – it is important that buyers know what they will qualify for now vs. later in a mortgage.  This will be especially important for first time homebuyers trying to get into the market.  For anyone looking to purchase a home, there’s nothing worse than setting your sights higher than your budget will allow.  

The need will always exist for people to sell or purchase a home.  Especially now with the increased flexibility of remote working, there has never been more a need for additional living space to allow for that home office. Perhaps you are relocating from one state to another, a first-time homebuyer, a move-up buyer, or downsizing for ease of living and/or retirement … the need will always be there with many of the lifestyle changes we all go through.  

My best advice to you …  stay in touch with your mortgage representative to ensure that with the expected rise in interest rates your expectation of what your budget will allow you to afford in a home is what it should be.  This will ensure while working with your Realtor that your home search parameters are set correctly.  The rise in interest rates is expected to be in small increments throughout the year, with the first set to be in March.  So, if you are thinking of purchasing a home this year, you may want to get that process in motion.  First, get pre-approved for a mortgage, so that you have that pre-approval letter in hand when you start your home search. And then, work with a local real estate professional to assist you in finding the home that will best suit your wants and needs.  Yes, it is still a seller’s market, given the current lack of inventory, and home prices are still on the rise.  With that in mind, you need to be ready for when that home comes on the market that says “Welcome Home” to you!

Helping buyers & sellers achieve their real estate goals

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