Should I Wait for Lower Mortgage Interest Rates?

Should I Wait for Lower Mortgage Interest Rates?

Historically low mortgage rates are a big motivator for homebuyers right now. In 2020 alone, rates hit new record-lows 16 times, and the trend continued into the early part of this year. Many hopeful homebuyers are now wondering if they should put their plans on hold and wait for the lowest rates imaginable. However, the reality is, acting sooner rather than later may be the actual win if you’re ready to buy a home.

According to Greg McBride, Chief Financial Analyst for Bankrate:

“As vaccines become more widely available and a return to normal starts to come into view, we’ll see mortgage rates bounce off the record lows.”

While only a slight increase in mortgage rates is projected for 2021, some experts believe they will start to rise. Over the past week, for example, the average mortgage rate ticked up slightly, reaching 2.79%. This is still incredibly low compared to the trends we’ve seen over time. According to Freddie Mac:

“Borrowers are smart to take advantage of these low rates now and will certainly benefit as a result.”

Here’s why.

As mortgage rates rise, the increase impacts the overall cost of purchasing a home. The higher the rate, the higher your monthly mortgage payment, especially as home prices rise too. Sam Khater, Chief Economist at Freddie Macsays:

Should I Wait for Lower Mortgage Interest Rates? | MyKCM

“The forces behind the drop in rates have been shifting over the last few months and rates are poised to rise modestly this year. The combination of rising mortgage rates and increasing home prices will accelerate the decline in affordability and further squeeze potential homebuyers during the spring home sales season.”

What does this mean for buyers?

Right now, the inventory of houses for sale is also at a historic low, making it more challenging than normal to find a home to buy in many areas. As more buyers hit the market in the typically busy spring buying season, it may become even harder to find a home in the coming months. With this in mind, Len Keifer, Deputy Chief Economist for Freddie Macrecommends taking advantage of both low mortgage rates and the opportunity to buy:

“If you’ve found a home that fits your needs at a price you can afford, it might be better to act now rather than wait for future rate declines that may never come and a future that likely holds very tight inventory.”

Bottom Line

While today’s low mortgage rates provide great opportunities for homebuyers, we may not see them stick around forever. If you’re ready to buy a home, let’s connect 508-930-5259 so you can take advantage of what today’s market has to offer.

It is my true pleasure to  work hard for my clients and your referrals throughout Massachusetts, Rhode Island, and Cape Cod.  Please let me know what questions you may have and how I can be of the best assistance to you.Shortcode

Jen McMorran, Realtor

Jennifer McMorran, Realtor, SRES
New Construction & First Time Home Buyer Specialist
MA, RI, and Cape Cod & Islands Licensed Real Estate Sales Associate
New Homes Team
508-930-5259
Jen.McMorran@gmail.com
www.jenmcmorran.realtor
real people. real estate. 

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#1 Reason NOT to Wait to List your House for Sale

The #1 Reason Not to Wait to List Your House for Sale

The #1 Reason Not to Wait to List Your House for Sale | MyKCM

Many industries have been devastated by the economic shutdown caused by the COVID-19 virus.

Real estate is NOT one of them.

Mark Fleming, Chief Economist for First American, just reported:

“Since hitting a low point during the initial stages of the pandemic, the only major industry to display immunity to the economic impacts of the coronavirus is the housing market. Housing has experienced a strong V-shaped recovery and is now exceeding pre-pandemic levels.”

Buyer demand is still strong heading into the fall. ShowingTime, which tracks the average number of buyer showings on residential properties, just announced that buyer showings are up 61.9% compared to the same time last year. They went on to say:

“Normally, real estate activity begins to slow down in the late summer, but this year it peaked in July, August and into September.”

There Is One Big Challenge

Purchaser demand is so high, the market is running out of available homes for sale. Just last week, realtor.com reported:

“Since the beginning of the COVID pandemic in March, nearly 400,000 fewer homes have been listed compared to last year, leaving a gaping hole in the U.S. housing inventory.”

The #1 Reason Not to Wait to List Your House for Sale | MyKCM

The National Association of Realtors (NAR) revealed that, while home sales are skyrocketing, the inventory of existing homes for sale is dropping dramatically. Below is a graph of existing inventory (September numbers are not yet available):Homebuilders are increasing construction, but they cannot keep up with the high demand. Bill McBride, founder of the Calculated Risk blog, in discussing inventory of newly constructed houses, notes:

“The months of supply decreased to 3.3 months…This is the all-time record low months of supply.”

What does this mean for sellers?

Anyone thinking of putting their home on the market should not wait. A seller will always negotiate the best deal when demand is high and supply is limited. That’s exactly the situation in the real estate market today.

Next year, when the pandemic is hopefully behind us, there will be many more properties coming to the market. Don’t wait for that increase in competition in your neighborhood. Now is the time to sell.

It is my true pleasure to  work hard for my clients and your referrals throughout Massachusetts and Rhode Island.  Please let me know what questions you may have and how I can be of the best assistance to you.

Jen McMorran, Realtor

Jennifer McMorran, Realtor, SRES
New Construction & First Time Home Buyer Specialist
MA & RI Licensed Real Estate Sales Associate
New Homes Team Kensington Real Estate Brokerage
508-930-5259
Jen.McMorran@gmail.com
www.jenmcmorran.realtor
real people. real estate. 

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Serving clients throughout Massachusetts, Rhode Island, and Cape Cod & the Islands.

Boston – Attleboro – Providence and the communities in between.

Whose market is it anyway?

Ah, the age old question in real estate from clients… is it a buyers’ market?  sellers’ market?   Economists define the state of our local real estate markets based on the amount of housing inventory available.   Inventory determines sellers or buyers market

In general, when there is less than a 6 month supply of housing inventory, we refer to that as a Sellers’ Market where home prices will tend to be increased.   When there is a 6-7 month supply of housing inventory,  this is a Neutral Market.  In a neutral market, home prices will follow the trend of inflation and not see significant price increases or decreases.  When there is more than a 7 month supply of inventory, this is referred to as a Buyer’s Market.  In a Buyer’s market, home prices will be decreased over time.

A key fact to remember … the type of market you fall into can vary based on your specific price point, your specific town, and even the specific area of town in which the property is located. 

So what does this mean when pricing your home or submitting an offer on a home to purchase?  These definitions merely provide a general guage of market activity.   It means you still must evaluate the active listing competition on the current market,  recent properties that have gone under agreeement, recent Sold property prices, AND how much selling or buying that specific property means to you.   Sometimes you only get one chance to make the sale or purchase a specific property.

Manorahan closing pictureThere is absolutely a business side to all real estate transactions, for investors, this is the critical piece to a transactions in purchasing and reselling properties.  For most consumers, though, buying and selling a Home also has a unique personal aspect.  Getting hung up on economic theory is not a reason to miss out on purchasing a new home or being able to sell to make a move that may be perfect for you and your personal situation.

Curious where your current property fits into the housing market?  Or are you looking for a property to finally call Home?  I’d love to help you gather the information needed to help you make the right real estate decisions for you… just give a call 508-930-5259, e-mail jen.mcmorran@gmail.com, or fill out the contact form below.

Always a pleasure to be of any assistance to you or anyone you know who is thinking about buying or selling a home. I love to work hard for my clients and your referrals throughout Massachusetts and Rhode Island.

Jen McMorran, Realtor

Jennifer McMorran, Realtor, SRES
New Construction & First Time Home Buyer Specialist
MA & RI Licensed Real Estate Sales Assocate
Kensington Real Estate Brokerage
508-930-5259
Jen.McMorran@gmail.com
www.jenmcmorran.realtor

real estate for real people.

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Massachusetts & Rhode Island.
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and the communities in between.