One of my lenders, Melanie Flynn of First Priority Financial, sent us this newsletter that I just had to share.
Where Are Interest Rates Headed?
This isn’t easy to say, but it must be said – rates are NOT going back down (at least not significantly). Rates being quoted right now range from the 4.75% area to above 5%, based on lender, consumer profile (credit score, program, money down, etc), and the day. When I say “the day”, I’m not being flippant – there really is such nauseating volatility that we are seeing rates jump by as much as .25% in interest rate in a single day.
With the drastic and dramatic jump we’ve seen since May 3rd, consumers may have thrown the brakes on for looking at houses – waiting for rates to come back down. It is important that you remember I’m here to help you convince the consumer of two things:
1) Rates are NOT going back down into the 3’s, or probably much (if any) below 4.5%.
2) They must continue their search now before home prices continue to go up along with the higher rates, further eroding their buying power.
Interest Rates – when they rise – decreases a clients buying power. I can see the graph from economic class now. As Interest Rates Rise, the cost of buying rises – therefore the purchase price or the home will decrease for the buyer.
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Thanks for reading – Sabrina