If all goes to plan, the increase in interest rates could curb inflation quickly, and a result of that could include some improvements in overall home affordability for those who are looking to buy a home. There’s no way to know what could happen, but here’s what many expect:
- Interest rates: If you wait until 2023, interest rates on most mortgage loans will likely be higher. That means you may spend more to buy the home when it comes to the loan costs. That doesn’t mean those prices are going to be significantly higher, but it could mean a few percentage points.
- Home inventory: While there’s no way to say you’ll never be outbid again, the chances are lower in the next year as inventory becomes more predictable in most areas. With more inventory available, there are also fewer reasons that home values will skyrocket in those bidding wars. Higher inventory leads to better access to buying what you want.
- Home prices: It’s unlikely there will be a significant housing value drop in the coming year, but home values may stop growing as quickly. There is some evidence of currently listed homes seeing price reductions right now, which could mean lower prices in some areas.
Will You Be Able to Afford More House Next Year, Though?
There’s no crystal ball to tell us the future of what’s to come. If you can afford to buy a home today that fits your needs and is within your budget, buy now. You may be better off buying now instead of waiting for the unpredictable real estate market of 2023.
More so, inflation is a factor. Though it is unlikely that you will find home prices rising due to inflation, you are likely to find it a bigger pinch on your budget.
With mortgage rates on the rise, there’s no doubt that buying now if you qualify for a lower interest rate is the better option overall. It will save you money to secure even an interest rate that's even a fraction lower this year than next year. For example, the monthly payment on a 30-year fixed rate loan at 2.99% could be $1,073, while it’s $1,184 on a 3.99% loan.
If you can afford to buy a home now and have the financing to do so, there's no real benefit to buying next year. Prices aren't likely to be much lower, though inventory may be a bit better. If you're able to find your dream home, it may be time to make your move now instead of waiting.
Get the Help You Need
If you’re frustrated with the lack of access to homes for sale, talk to your agent about it. There is improvement in new listings, which could give you the perfect opportunity to buy what you want at the lowest interest rates for the foreseeable future. On the other hand, waiting too long doesn't seem to have the same benefits, and it could end up costing you.
Let's discuss your situation today so that you can start your home search with confidence.
For more details Contact today
Oyler Hines of Coldwell Banker 7813 Ted Gregory Lane, Montgomery OH 45242 513-547-2997 5135472997 https://www.oylerhines.com/
- Interest rates: If you wait until 2023, interest rates on most mortgage loans will likely be higher. That means you may spend more to buy the home when it comes to the loan costs. That doesn’t mean those prices are going to be significantly higher, but it could mean a few percentage points.
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