Because interest rates have been relatively low in recent years, buyers have been able to afford more expensive homes than they would otherwise be able to buy. This inverse relationship between mortgage rates and home prices has generally worked to the advantage of sellers, who have enjoyed the benefit of getting the most money for their homes. However, as the Federal Reserve moves further toward taming inflation, rising mortgage rates may begin to temper home prices. Would-be sellers should bear this in mind, as they consider whether they want to place their properties on the market. Playing the waiting game for an unnecessarily long period may work against sellers who do not act sooner than later.
As rates are rising, homebuyers are trying to lock in current rates before they rise further and demand for mortgages continues to be strong. There are many benefits of homeownership, from building equity to getting tax breaks. But there are plenty of up-front fixed costs associated with buying a home. A common guideline is that it makes sense to buy only if you plan to stay in your home for at least 5-7 years. For information, please call my office at 732-297-1100 ext 114. As a RE/ MAX Diamond REALTORS(r) Sales Associate, I can provide you with the resources you need to make the home selling process simpler. My office is located at 3430 Route 27 in Kendall Park.
HINT: The 10-year Treasury yield is the predominant factor in determining mortgage rates.