Mortgage rates have risen this year. According to industry experts, it will likely rise more throughout the year. This is important information for potential buyers. Mortgage rates rising in 2015 and what buyers in MA must know is provided below.
Affect of Mortgage Rates Rising In 2015
The amount of your monthly mortgage cost is a reflection of the mortgage rate. Increases in mortgage rates lead to a lower approval level or a more expensive mortgage amount for the same home. Even a slight variation may make a difference. If you are trying to purchase a house at the max approval level, any change will really affect you.
Below is an illustration of how price limits can fluctuate with mortgage rates. This is assuming a static down payment percent and keeping the mortgage payment the same.
|Mortgage Rate||Price Limit|
Additional Affordability Factors
Other than mortgage rates, real estate values can also change. In most markets, real estate prices have been improving progressively for over a year. Certain areas are seeing bidding wars and offer prices beyond asking. A lot of this is a result of fewer homes for sale than usual.
What Buyers In MA Must Know When Deciding Whether to Buy Now or Wait
Upward mortgage rates and market prices both have a negative effect on buyers. People will see that their affordable price lowers as this continues. The quality of properties within price point will be less desirable too. With both factors in play, it seems better to act now than later.
About This Spring
Spring is usually the most active season for real estate. There should be a higher number of houses for sale to accommodate the pent up demand, but competition will be strong as well. Individuals deciding to act may take advantage of lower mortgage rates. Forecasted increases in property values will offer an opportunity to gain equity more rapidly than typical.