01/05/2023
Although mortgage interest rates are higher than the unprecedented lows of the 2000’s, buyers should not wait to purchase a home now. If it is true that “History repeats itself”, interest rates may increase even more. Let’s take a quick look at history for a look into our possible future.
Freddie Mac began tracking mortgage rates in 1971. The 30-year rate was at an average of 7.29% to 7.73%. Rates began increasing in 1974 and continued increasing into the 1980’s to keep inflation in check. Rates reached double digits increasing as high as 18.45% in 1981. 1982 saw inflation come back to normal levels, however the rates continued in the double digits for most of the remainder of the decade as the Feds were trying to make up for the past inflation period. Interest rates dropped to single digits in the 1990’s and continued to drop to their lowest level ever in 2020 during the pandemic.
On December 14, 2022, the Federal Reserve announced that more interest rate hikes are in store for 2023 to help contain inflation. If history repeats itself, interest rates will have to bolster the past inflation. However, some economists are declaring that they see signs of inflation slowing down. So, what to do? I say, buy now, take advantage of the current interest rate and count your lucky stars if rates do go up. OR, buy now, get into the home you want, and if rates do decrease, refinance to take advantage of the new low rate. The idea is that you should buy when you are emotionally ready and find the home you want. It's what our parents did. Rates will do what they do. Everyone adjusts when the time is right. Don’t lose your dream home waiting for interest rates to reach a certain point. The perfect time to buy is now.
Call me. I will help.