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Updated: Mar 18
Interest Rates Are Going Down
Interest Rates are going DOWN. Since its peak last November, where they were around 7-8%, interest rates are FINALLY stabilizing. I polled several of our communities most trusted lenders today and here is what I can generally share with you:
One said: 5.25-5.5%
Second said: Conventional around 6% and VA/FHA around 5.125%
Third said: 5.5%
For my browsers and my buyers out there who have been waiting for rates to settle, this spring may just be your time!
Also, I'd like to address those waiting for the great return of 2-3% interest rates. The Federal government, economists, and banks with a WAAYYY higher IQ than me are not anticipating them to come back. While I know that is wearisome, I don't want you to miss out on the opportunity right in front of you, if we can reach your real estate goals now!
The way I see it, you have three options:
1) You can wait for the 2-3% rates and while doing so home prices go up and you'll miss out
2) You buy now and in the off chance rates go back down, you still have equity in the home and you can refinance
3) You wait for the ideal price and rate and never get in the market....this would be so sad!!
I want to share a quick story of how I missed out while waiting for the great price drop and better interest rates.
I was in Arizona at the time. My husband and I were looking to buy a new construction home in Queen Creek. We were pre-approved for $400,000. We went under contract for a home at $350,000 and then selected several upgrades, pushing our price to $387,000. This was a ranch style, 5 bedroom home, and around 3,000 sq ft in the heart of Queen Creek. We paid a $3,000 construction deposit and selected a corner lot.
I felt sick to my stomach about it, because I thought we were buying too high and that we should wait longer, so we backed out of the contract and lost our deposit. This was in 2017.
Well, now, in 2023 after the LARGEST equity growth we have seen, do you know what the home would value around now? $735,000.
We would have built over $330,000 in equity!
We missed out, because we were waiting for a price drop that did not come.
The bottom line is this: time in the market is better than timing the market. If you are ready to buy, lets get you a home! Don't wait for external circumstances you can't control to influence your decision to buy.
Learn from my mistake.