Two things working to a buyer’s advantage today are low mortgage rates and home prices. Here’s a look at what the experts are saying, and why sooner rather than later may be an ideal time to buy a home.
1. Low Mortgage Rates
Today’s low mortgage rates are not just low – they’re hovering near historic all-time lows.
The even better news? According to Freddie Mac, rates are forecasted to remain low through the first quarter of next year (see graph).
Lawrence Yun, Chief Economist at NAR, says:
“After a pause, home sellers are gearing up to list their properties with the reopening of the economy…Plenty of buyers also appear ready to take advantage of record-low mortgage rates and the stability that comes with these locked-in monthly payments into future years.”
Whether it’s your first home, your dream home, or a long-anticipated downsizing move, if you’re thinking of buying, now may be an ideal time to lock in a low rate.
2. Home Price Appreciation
In addition to low mortgage rates, home prices are a bright spot for buyers as well. According to forecasts from leading expert institutions, prices are projected to continue rising this year, though not as quickly as they were coming into 2020.
Dr. Frank Nothaft, Chief Economist at CoreLogic notes:
“The very low inventory of homes for sale, coupled with homebuyers’ spur of record-low mortgage rates, will likely continue to support home price growth.”
Projected appreciation, even when small, is great news, as it indicates the value of a home you buy now will continue to grow. That’s positive equity going straight into your pocket as a homeowner.
According to the Realtors Confidence Index, buyer demand is also outpacing seller traffic. This means there are many more buyers on the market looking for homes today than sellers listing their houses. This law of supply and demand is a big factor that’s keeping home prices in check.
Mark Fleming, Chief Economist at First American says:
“Housing supply remains at historically low levels, so house price growth is likely to slow, but it’s not likely to go negative.”
With demand still stronger than supply, meaning more buyers on the market than listings available, home values should not depreciate. With that information in mind, you can feel confident about buying in the current market, if the time is right for you.
Bottom Line
Mortgage rates are hovering near historic lows and prices are not forecasted to depreciate. If you’re thinking about buying a home, now may be a great time to lock in a low mortgage rate and make your next move.
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