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Whether You Are Buying or Selling in the Washington, DC DMV; With Mortgage Rates Climbing, Now’s the Time To Act!
As REALTORS in the Washington, DC metro, we pay close attention to the factors that impact our sellers and our buyers, and 1 chief metric is making impressive changes. Last week, the average 30-year fixed mortgage rate from Freddie Mac jumped from 3.22% to 3.45%. That’s the highest point it’s been in almost two years. If you’re thinking about buying a home, this news may have come as a bit of a shock. But the truth is, we knew this was coming.
Experts have been calling for rates to rise in their 2022 projections, and the forecast is now becoming a reality.
Here’s a look at the projections from Freddie Mac for this year:
• Quarter 1 2022: 3.4%
• Quarter 2 2022: 3.5%
• Quarter 3 2022: 3.6%
• Quarter 4 2022: 3.7%
As the numbers show, this jump in rates is in line with the expectations from Freddie Mac. And what they also indicate is that mortgage rates are projected to continue climbing throughout the year. Up almost a .5% point just this year. On top of that if inflation continues at a fast pace they could go higher.
But should you be worried about rising mortgage rates? What does that really mean for you?
As rates increase even modestly, they impact your monthly mortgage payment and overall purchase power and home affordability.
If you’re looking to buy a home, rising mortgage rates should be an incentive to act sooner rather than later. Waiting for rates to drop or home prices to be lower are just not what the market is showing. Waiting is only costing YOU.
The good news is, even though rates are climbing, they’re still worth taking advantage of. Historical data shows that today’s rate, even at 3.45%, is still well below the average for each of the last five decades (see chart below):
That means you still have a great opportunity to buy now with a rate that’s better than what your loved ones may have paid in decades past. If you buy a home while rates are in the mid-3s, your monthly mortgage payment will be locked in at that rate (fixed rate Mortgages) for the life of your loan. As you can see from the chart above, a lot can change in that time frame.
Buying now is a great way to protect yourself from rising costs and future rate increases while also securing your payment amount for the long term.
The other cost that will keep rising is RENT. Rents are up 12% year over year or more in our area. So, if you are renting the only way to “stabilize” your housing costs is to purchase. By the way you’re paying a mortgage it just not yours.
Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), says:
“Mortgage rates surged in the second week of the new year. The 30-year fixed mortgage rate rose to 3.45% from 3.22% the previous week. If inflation continues to grow at the current pace, rates will move up even faster in the following months.”
Mortgage rates are increasing, and they’re forecast to be even higher by the end of 2022. If you’re planning to buy this year, acting soon may be your most affordable option.
Work with a trusted advisor to start the homebuying process today. We here at The Noble Team are keeping up with the information that Matters to you. Because “A Home Changes Everything”
with eXp Realty
866-825-7169
eXp Realty LLC
1050 Connecticut Ave NW Suite 500
Washington, DC 20036
