Mortgage Rates Are Increasing - What Does This Mean To You?

Mortgage Rates Are Increasing - What Does This Mean To You?

Many veteran mortgage loan officers agree that they have not seen mortgage rates rise as fast as they have in the past 2 months. Despite a little dip in rates in the past week, rates have climbed nearly 1% in the past 2 months.

What does this mean to you?

Since real estate is an element of a vibrant economy, many people are watching their local real estate market. Whether you are a plumber, electrician, carpet layer, roofer or landscaper; there is a good bet that a vibrant real estate market helps dictate the success of your business.

Just because rates are going up and it will cost $52 a month for home buyer's to buy the same home (based off of a $200,000 purchase price with 20% down) lets don't panic.

First, home buyers who have been straddling the fence will be starting to jump to capture these historic lows. I know that 4.50% is higher than 3 months ago, if you have been in the real estate business as long as me, you remember when mortgage rates where above 10%.

I have talked to several mortgage loan officers and bankers and they said that they have noticed an increase in mortgage applications despite the rise in mortgage rates. Look for this to continue this summer.

Second, homes have increased in value enough that home sellers will not need to cash out their savings in order to sell. Those home sellers who have been on the fence about selling and buying a bigger home will start to put those plans in actions.

I'm thinking that the Kansas City real estate market will be vibrant for another 2 months before the increased rates and inventory will start taking a major effect on the real estate market. Contractors will be busy building new homes; as well as, doing repairs on resale homes. Home buyers will see the increased inventory pleasing and home sellers who jump first will their homes selling fast.

Do you agree?

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