If you've become interested in purchasing real estate, now may not be the time due to rising mortgage rates. For several weeks, mortgage rates dropped, making it a good time to buy, but now, as of June 14, those rates are on the rise again. That means that you'll be more likely to spend greater amounts for less house.
Data released by Freddie Mac indicated that the 30-year fixed-rate average jumped up to 4.62 percent, whereas it was 4.54 percent just last week. In 2017, its rate was 3.91 percent, showing how much more people will spend in interest today than in the past.
The interest-rate spike is partially a result of a better economy in the United States. A strong economy allows the Federal Reserve to hike rates, because consumers are more likely to be able to afford them. This earns the government money, which in turn could help continue to bolster the economy.
It's expected that mortgage rates will continue to rise, so if you're looking to purchase shortly, you may want to consider this before you decide on a home or property. It's normally best to keep track of the real estate and economic forecasts to try to purchase when rates are at their lowest.
Mortgage application rates also decreased, but the number of FHA applications increased, indicating that there is a great number of first-time buyers entering the market. This is also a good sign of an improving economy particularly affecting millennial consumers. With looser lending happening now, it's easier for some to get loans than in the past, making it a potentially good time to buy if a person's credit is shaky.
Source: The Washington Post, "Mortgage rates charge back, moving toward yearly highs," Kathy Orton, June 14, 2018