Last week, anarticlein theWashington Postdiscussed a new ‘threat’ homebuyers will soon be facing: higher mortgage rates. The article revealed:
“The Mortgage Bankers Association expects that rates on 30-year loans could reach 4.8 percent by the end of next year, topping 5 percent in 2017. Rates haven’t been that high since the recession.”
How can this impact the housing market?
The article reported that recent analysis fromRealtor.comfound that -
“…as many as 7% of people who applied for a mortgage during the first half of the year would have had trouble qualifying if rates rose by half a percentage point.”
This doesn’t necessarily mean that those buyers negatively impacted by a rate increase would not purchase a home. However, it would mean that they would either need to come up with substantially more cash for a down payment or settle for a lesser priced home. Below is a table showing how a jump in mortgage interest rates would impact the purchasing power of a prospective buyer on a $300,000 home.
If you are considering purchasing a Lake Norman home (either as a first time buyer or move-up buyer), purchasing sooner rather than later may make more sense from a pure financial outlook. Industry experts say the economic recovery will undoubtedly cause rates to rise and many Mooresville, Charlotte area buyers may no longer enjoy the purchasing power they now have.
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Author:Kelly Meyer Phone: 704-819-2774 Dated: December 1st 2015 Views: 143 About Kelly: ...
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