The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate, the greater the payment will be. That’s why it is important to know where rates are headed when deciding to start your home search.
Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next year.
In July, Freddie Mac’s U.S. Economic and Housing Marketing Research Group issued the following statement:
“The 30-year fixed mortgage rate has been slightly declining since mid-June and was 4.53 percent in the second week of July. Rates have stepped back because of declining long-term Treasury yields, which continue to be pushed down by anxieties from a potential trade war. Our forecast has the 30-year fixed-rate mortgage averaging 4.6 percent this year, and rising to 5.1 percent next year.”
Fort those that don’t know, forecasts are an educated guess based on current trends within the housing market, Wall Street, and the broader economy. While they are reliable, there’s a chance they could become inaccurate over time.
Home Prices Are Still On The Rise
According to CoreLogic’s latest Home Price Index, national home prices have appreciated 6.2% from this time last year and are predicted to be 5.1% higher next year.
Based on the 2019 mortgage forecasts, homebuyers might not need to worry about a big jump in mortgage rates any time soon. However, rising home values are a very real concern.
House values in most U.S. cities are expected to rise gradually throughout 2019. This could reduce affordability and buying power for many people. So postponing a home purchase could mean that you’ll end up paying more.
In mid-August 2018, the real estate information company Zillow wrote the following:
“The median home value in the United States is $217,300. United States home values have gone up 8.3% over the past year and Zillow predicts they will rise 6.6% within the next year.”
Bottom Line is … while mortgage rates are predicted to steadily rise; home prices are on the quick incline. If you put off buying your next home, you are risking paying more.
Give the Robinson Team a call. Let us assist you in selling your home, as well as finding your next one. No matter the season, The Robinson Team sells homes!