Mortgage Rates Monday Updates ~ I’ve prepared a detailed video for you 👇👇👇 and know the difference between The Federal Reserve Interest Rates and Mortgage Rates. You’ll need to know how the increase in Mortgage Rates will affect the Metro Detroit Housing Market and your purchasing power. See my solution on how you can Save Thousands in Closing costs. When mortgage rates go down you can save again and lower your monthly payment.
Mortgage Rates Continue Climbing
April 11, 2022
Based on the Primary Mortgage Market Survey
Mortgage rates have increased 1.5 percentage points over the last three months alone, the fastest three-month rise since May of 1994. The increase in mortgage rates has softened purchase activity such that the monthly payment for those looking to buy a home has risen by at least 20 percent from a year ago.
Just a few months ago, Freddie Mac projected mortgagerates would average 3.6% in 2022. Earlier this month, Fannie Mae forecast mortgage rates would average 3.8% in 2022. As the chart above shows, rates have already surpassed those projections.
Nadia Evangelou, Director of Forecasting, NAR
While higher short-term interest rates will push up mortgage rates, I expect some of this impact to be mitigated eventually through lower inflation. . . . Thus, I expect the 30-year fixed mortgage rate to continue to rise, although we aren’t likely to see the big jumps that occurred over the past few weeks.
Mark Fleming, Chief Economist at First American:
There’s never been a truer statement regarding forecasting mortgage rates than the one offered last year.
“You know, the fallacy of economic forecasting is: Don’t ever try and forecast interest rates and or, more specifically, if you’re a real estate economist mortgage rates, because you will always invariably be wrong.”
Coming into this year, most experts projected mortgage rates would gradually increase and end 2022 in the high three-percent range. It’s only April, and rates have already blown past those numbers. Freddie Mac announced last week that the 30-year fixed-rate mortgage is already at 4.72% and now over 5%
Danielle Hale, Chief Economist at realtor.com, tweeted on March 31:
“Continuing on the recent trajectory, would have mortgage rates hitting 5% within a matter of weeks. . . .”
Mortgage News Daily April 5th
Just five days later Mortgage Daily News quoted a rate of 5.02%.
No one knows how swiftly mortgage rates will rise moving forward. However, at least to this point, they haven’t significantly impacted purchaser demand.
Ali Wolf, Chief Economist at Zonda, explains
“Mortgage rates jumped much quicker and much higher than even the most aggressive forecasts called for at the end of last year, and yet housing demand appears to be holding steady.”
Through February, home prices, the number of showings, and the number of homes receiving multiple offers all saw a substantial increase. However, much of the spike in mortgage rates occurred in March. We will not know the true impact of the increase in mortgage rates until the March housing numbers become available in early May.
Rick Sharga, EVP of Market Intelligence at ATTOM Data
Recently put rising rates into context:
“Historically low mortgage rates and higher wages helped offset rising home prices over the past few years, but as home prices continue to soar and interest rates approach five percent on a 30-year fixed rate loan, more consumers are going to struggle to find a property they can comfortably afford.”
History suggests that when rates rise, there is an initial bump in home prices as many move quickly to buy a home before rates increase further. But after that period, home prices slowed. Freddie Mac’s analysis shows that a 1% increase in mortgage rates results in-home price appreciation that is 4 percentage points lower. For instance, a 1% increase in mortgage rates would change home price growth from 11% to 7%.
Where Are Mortgage Rates Going from Here?
The best way to track is the 10-year Treasury Yield. I provided a link below so you can rack the trends live. I have a feeling this will be a roller coaster ride and you’ll want to track before you lock your rate. It’s like watching the ticker at on the Stock Market they are moving that fast. While no one knows exactly where rates are headed, experts do think they’ll continue to rise in the months ahead. In the meantime, if you’re looking to buy a home, know that rising rates do have an impact. As rates rise, it’ll cost you more when you purchase a house. If you’re ready to buy, it may make sense to do so sooner rather than later.
What Does The Increase Mortgage Rates Mean for You if You’re Looking To Buy a Home?
With both mortgage rates and home values expected to increase throughout the year, it would be better to buy sooner rather than later if you’re able. That’s because it’ll cost you more the longer you wait. But, there is a possible silver lining to buying a home right now. While you’ll be paying a higher price and a higher mortgage rate than you would have last year, rising prices do have a long-term benefit once you buy.
If you purchase a home today valued at $400,000 and put 10% down, you would be taking out a $360,000 mortgage. According to mortgagecalculator.net, at a 4.42% fixed mortgage rate, your mortgage payment would be $1,807 a month (this does not include insurance, taxes, and other fees because those vary by location).
Now, let’s put that mortgage payment into a new perspective based on the substantial growth in equity that comes with the escalation in home prices. Every quarter, Pulsenomics surveys a panel of over 100 economists, investment strategists, and housing market analysts about their expectations for future home prices in the United States. Last week, Pulsenomics released their latest Home PriceExpectation Survey. The survey reveals that the average of the experts’ forecasts calls for a 9% increase in home values in 2022.
Based on those projections, a $400,000 house you buy today could be valued at $436,000 by this time next year. If you break that down, that means the equity in your home would increase by $3,000 a month over that period. That’s greater than the estimated monthly payment above. Granted, the increase in your net worth is tied to the home, but it is one way to put the home price appreciation to use in a way that benefits you.
My Solutions to High Mortgage Rates and Cost ~ Save Thousands in Closing Cost and when Rates go down Refinance and Save again.
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See how you can save thousands on your mortgage closing cost. It’s your money, we need to put it to work for you. Why give it to your lender, aren’t they making enough in what they are charging in mortgage rates?
We have our best loan officer who can assist you and answer all your questions. Unlike some other lenders, Keller Mortgage isn’t spending millions on marketing and advertising. Therefore, we pass those savings on to you by offering no fees and a low rate. Plus $1,000 Cash Credit at closing for loans $150k or more! Contact my Cell with any questions at 248-343-2459 or 👇👇👇 request help below.
Spring Housing Predictions 2022: What to Expect
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Bottom Line for Mortgage Rates
Paying a higher price for a home and a higher mortgage rate can be a difficult pill to swallow. However, waiting will just cost you more. If you’re ready, willing, and able to buy a home, now will be a better time than a year, or even six months from now. Let’s connect to begin the process today.
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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