Mortgage rates have gone down which is great news for Homebuyers in Metro Detroit MI. Find out how to track and predict the trends.
Over the past few weeks, the average 30-year fixed mortgage rate from Freddie Mac fell by half a percent. The drop happened over concerns about a potential recession. And since mortgage rates have risen dramatically this year, homebuyers across the country should see this decline as welcome news. This is great news for 1st-time Homebuyers who put their home purchase on hold.
Mortgage Rates Today and Your Purchasing Power
Mortgage rates are higher today and slowly lowering where they should be historical. The 10-year Treasury and it’s dropping quickly and historically mortgage rates follow. I follow the trends 3 times a day and this is how I time the mortgage rate market. We haven’t seen rates this low since April 7, 2022. Keep in mind it will depend on your FICA Score and downpayment. I have recommendations below on how to show for a mortgage.
30-Yr additional .08 / 15- yr .06 / 5/1 Arm .03 ~ fees/points
Today, buyers are reacting in one of two ways: they’re either making the decision to buy now before rates climb higher or they’re waiting it out in hopes rates will fall. Let’s look at some context that can help you understand why so many buyers are jumping off the fence and into action rather than waiting to buy.
A Look Back: How the Current Mortgage Rate Compares to Historical Data
One factor that could help you make your decision to buy now is how today’s mortgage rates compare to historical data. While higher than the average 30-year fixed rate in recent years, the latest rates are still comparatively low when you look at the bigger picture of where rates have been since 1971 (see graph below):
A Look Ahead: What Happens if Rates Climb Further
The buyers who are springing into action now are also motivated to make their move because they know rates have risen steadily this year, and they’re eager to get ahead of any further increases.
Why? When mortgage rates climb, they impact the monthly mortgage payment you’ll have on the home you’re buying. Basically, it’ll likely cost you more to buy a home if you wait. Experts say mortgage rates will rise (although more moderately) in the months ahead
Mortgage Rates Since the Last Housing Boom
It helps to understand the mortgage rates trends and dipping into the 3.5% and below range wasn’t normal. The Feds propped up the 10-year Treasury Yield to help stabilize the job market and the economy due to the pandemic. Due to Supply and Demand prices kept rising. In 2021 the home-buying frenzy occurred driving up prices even more. for the first time since April 9th, the yield went down under 2.8%, so this might be the start of a trend that I’m watching closely.
The Housing Bubble and Home Price Appreciation
As you can see by the graph below how the last housing bubble started in 2000 and mortgage rates were at a whopping 8.62%. The only way to protect the housing market and future equity growth was to get a handle on Supply and Demand and home prices. You buy a house vs renting to build your future wealth via your home equity. Yes, it’s a bummer you could capitalize on the low rates, and on the other hand, how would you feel if the value of the home plummetted and you were paying for a house with negative equity? In order for the economy not to slip from inflation to recession, changes needed to occur quickly. The job market changes in 2005 started the chain reaction of the Great Recession and the Crash in the Housing Market NOT mortgage Rates. Another way to look at it is how would you feel if we kept going with the low rates, inflation moved to recession and you lost your job and couldn’t pay for your mortgage? I was there the first time, this was the right move. I just prepared a detailed blog post Are We in a Housing Bubble Ready to Pop?
10-year Treasury Yield affects the Mortgage Rates NOT the Federal Reserve Interest Rates.
To prop up the economy during the pandemic the Feds offered investors a great incentive to buy 10-year Treasury Bonds. The yield went to record lows and mortgage rates followed. So now we have to add another layer to this hot mess and the cause of the huge increase in the 10-year Treasury is the war in Ukraine setting off crude prices to rise and adding to the inflation problem we already had. The great news is all can be fixed in time. What we need to do at this point is protect our steady growth in the housing market, keep inflation in check, and the jobs market. Great New! After the last Federal Reserve increst Interest Rate in July, the Treasury Yield for the first time in months broke the 2.7% range. When the 10-year Treasury Yield goes down Mortgage Rates follow. At this time we are still bouncing around the 2.700% -2.899%
Should You or Shouldn’t You Buy a House Now?
So, if you’re ready and financially able to buy now, it may make more sense to get off the fence and make your purchase sooner rather than later. As Nadia Evangelou, Senior Economist at the National Association of Realtors (NAR), says:
“With even higher interest rates on the horizon, I don’t see any reason to hold off from purchasing a home right now. If you feel financially secure, you should start looking for a home.”
At the end of the day, there is no perfect advice on when to buy a home. What you should do depends on your goals, your finances, and your personal situation. Use this information with the help of local real estate professionals to make an informed decision on what’s best for you. The Mortgage Reports sums it up best:
“. . . if you’re on the fence about whether to buy now or wait for a better deal, buying sooner rather than later might be wise. That said, home buying is always a personal decision. Whether you should buy in 2022 depends on your financial situation and the local housing market where you live.”
My Solution to Mortgage Rates
One thing history has shown us from the above graphs, what goes up will come down so you can refinance to lower your mortgage rate and your monthly payment.
Step #1 ~ Do You Homework to find the Best Lender and Program for You
💥 Important 💥 We’ve seen many changes lately with high mortgage rates and now lenders are designing special programs to help you and compete for your business… Great News!
✅ Do ~ Call around and check out and get quotes for rates and what type of programs different lenders have available. Give the lenders your FICA score to get quotes.
✅ Do ~Call around and check out and get quotes for rates and what type of programs different lenders have available. Give the lenders your FICA score to get quotes.
🛑 DON’T ~give out your Social Security Number as they will pull your credit. Wait until you select a lender and a program that works best for you then make an application. You are getting rough quotes for now based on the FICA score you obtained, it doesn’t have to be exact for now. You’re in the weeding-out phase of your search.
✅ DO ~ contact me with any question you may have via my cell at 248-343-2459
🙋♀️~ Not sure where to start? Get Your Do’s and Don’ts during the loan process. Below are lenders I’ve worked with in the past that offer amazing programs and options. You can also check with your Bank or Credit Union (Alpha order: not based on preference.)
First State Bank – Manny Nino – Loan Officer 📲 Cell: 586-945-5203
Flagstar Bank – Ray Cela – Loan Officer/VP Sale 📲 Cell: 248-238-1849
Keller Mortgage – MaryAnn O’Brian – Loan Officer 📲 Cell: 843-368-7163
Step #2 ~ Your 🔑 To Home Selling and Buying Success ~ Safe e-Guides
💥 Important 💥 Your Guides also have educational videos and links regarding where home prices are heading, mortgage rates, Housing Market Trends, and more.
Watch Video for Sneak Peak
Don’t muddle through the Home Buying and Selling Process. Buying a new home is a dream for all of us, and it’s an emotional and stressful process.
Step #3 ~ 💥Search Better Than a Realtor💥 on a Platform that was Designed by One.
Find Your Ideal Home Here ~ Pre-loaded Home Search: Newly Listed ~ Coming Soon ~Luxury~ Waterfront ~ and More🤩
Create an account and save your favorites and email updates. Another huge feature you can modify and look for homes Coming Soon only, or view homes that have been on the market X number of days. Maybe a 1st floor primary bedroom or office is important. You can even search by lot features like Finished Basement ~ Golf Frontage ~ Water Frontage ~ Acreage ~ Large private treed lot ~ Cul-de-Sac and More.
Bottom Line: Increased Mortgage Rates
Serious buyers should approach rising rates as a motivating factor to buy sooner, not a reason to wait. Waiting will cost you more in the long run. Let’s connect today so you can better understand your budget and be prepared to buy your home even before rates climb higher.
Simplifying Real Estate Through Education
As we move forward, it’s been challenging as we navigated through all the changes. Putting your dream of a new home on HOLD shouldn’t be one of them. Now more than ever, knowledge will be your power. Know the Market You’re In and your Negotiation Power. Check out Categories for additional updates regarding the Market | Buying | Selling
If You Need To Sell 1st… I Recommend 🛑Doing This!
No 2 homes are alike, and agents need to 🛑 marketing ONE size fits all. We no longer have an exposure problem (internet). Your home is buried on public home search internet sites. The only way to compete on those platforms is the price. If you want more money, you need to apply Influence. Separate your home from the competition, so the Buyer sees value. Keeping them focused on your property and not getting lost in homes’ inaccurate data on public internet sites is necessary. Having digital omnipresence on serval platforms is your key to success. Remember MORE INFLUENCE = MORE 💰. We have details on how you can utilize High Tech Marketing and Win!
If you have any questions, contact us: Chatbot 🤖 at the bottom. Contact me by Email 📩 or my Cell 📲 @ 248-343-2459. Would you mind sharing your thoughts below or what future article you would like to see? Your opinion is important to us…. this site is for you.🤩 To Keep up to date request our 🏡 Chat Newsletter or Follow us on Facebook, Instagram, or YouTube.