Fannie Mae released their monthly forecast for mortgage rates. The previous month, they received a lot of attention because of how rosy it was with rates forecasted to hit 5.9% by the end of this year with nearing the mid-5% range in 2025. The March forecast, which was released yesterday, is not as optimistic.
The difference in the forecasted rate for 2024 Q4 is 0.5%. The half point in interest rate on a $400,000 loan amount is $129 when amortized for 30 years.
Of course, this is just a forecast and not a guarantee of where mortgage interest rates will be in the future. However, if I were sitting on the fence waiting for rates to enter into the 5% range, I would stop…now. Actually, if you’ve read my blog or social media post, you know that I would never wait for the possibility of mortgage rates to be 5%. Why? Because it’s not certain and it’s trading lower home prices for a possible low rate or paying more for the same home with potentially higher rates. Mortgage rates are the unknown. What is known is that we have a housing shortage (especially affordable housing). With the lack of inventory we’re experiencing, home prices are set to continue to rise. Lower mortgage rates will not help home prices. There is a cost to waiting and the cost can be significant if it’s losing a home that you want.
Existing Home Sales was released today:
- 20% of sold over the list price.
- 26% of home buyers were first-time home buyers.
- 33% were cash buyers (I have a cash buyer program!)
- 21% were investors.
- Inventory is at a 2.8 month’s supply – a “normal” market is 4.6 months.
I have several reports that I can prepare that factor projected appreciation by zip codes illustrate the cost of waiting or how long it takes to break even when you bid over ask. Reach out to me if you would like more information!
And of course, if you’re considering buying, refinancing or remodeling your home, I am happy to help you!
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