Interest Rates are Rising!
November 21, 2016
Don’t get caught off-guard, interest rates are quickly rising. If you are in the market to buy a home or refinance your current house, call your mortgage advisor today to better understand how the rise in interest rates impacts your purchasing power. This morning’s Pacific Union Blog provided a great update on where things stand today.
Here’s what they said, “MORTGAGE RATES SOAR AS THE DUST SETTLES FROM THE ELECTION . Mortgage rates ballooned last week in the wake of the U.S. presidential election, which could make for a flurry of activity followed by a slowdown.
According to Freddie Mac data, 30-year, fixed-rate mortgages average 3.94 percent for the week ended Nov. 17, up from 3.57 percent a week earlier. In a statement accompanying the report, Freddie Mac Chief Economist Sean Becketti said that he expects a final blitz of home sales and refinances as buyers try to beat interest-rate hikes, then a pronounced cooling in the market.
At last week’s Pacific Union Real Estate and Economic Forecast to 2019, company CEO Mark A. McLaughlin demonstrated how rising interest rates could impact affordability in the Bay Area. Assuming a 4 percent fixed interest rate on a 30-year mortgage, about 25 percent of Bay Area households can afford a $1 million mortgage. If interest rates rise to 5 percent, the number of households who can afford that $1 million mortgage drops to 20 percent; if rates rise to 6 percent, affordability further erodes to 16 percent of the population.”
With this interest rate news, today really is a great day to buy a home despite the limited inventory and holiday season rapidly approaching. Perhaps you should take a second look at the current inventory available! My team and I are available to help and would be happy to further discuss what this news means for you. We have had great success stories in the past with clients finding wonderful opportunities in the midst of holiday chaos. The best place to reach me is Dana@danagreenteam.com and 925-339-1918.
Categorized in: Bay Area Real Estate Outlook
Written by Dana Green, Realtor