February 22, 2018 | Heather Lynch
Mortgage rates forecast for February 2018
Wow, how things have changed in a month. As 2018 started, mortgage rates had held below 4% for 26 straight weeks, according to mortgage agency Freddie Mac. Within two weeks, the average 30-year rate nationwide was up to 4.15%, and that reading doesn't even factor in the whole upswing, due to Freddie Mac's delayed data. The good news is that mortgage rate shoppers haven't been priced out of a refinance or home purchase — yet. But, as we'll discuss, the odds are not in our favor in February. It appears predictions of higher rates are coming true.
Most major housing agencies and groups are predicting higher rates for 2018. What do these forecasts mean for the home buyer and refinancing household? It's possible that you will pay more for a house, or reduce your savings from a refinance by the end of the year. Fortunately, rates are still near half their historical average. There's still time to lock in current rates before they rocket higher.
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How the Fed rate hike may affect homebuyers
Generally as the economy strengthens, the Fed raises rates. So while rising rates are a positive signal for the economy as a whole, there are some consequences that aren't always positive for potential homebuyers.
Those on the Brink of Buying May Need to Move Quickly. Experts don’t expect mortgage rates to rise too much following the Fed rate hike. Some don’t believe rates will exceed 5%. According to the deputy chief economist at Freddie Mac, rates should stay between 4.25% and 4.30% during this year’s home-buying season (roughly spring into early summer). Nevertheless, soon-to-be homeowners may need to act fast if they want to lock down the lowest rates.
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Mortgage Interest Rates Just Went Up… Should I Wait to Buy?
There are some who are calling for a decrease in home prices should mortgage interest rates begin to rise rapidly. Intuitively, this makes sense as the cost of a home is determined by the price of the home, dosage plus the cost of financing that home. If mortgage interest rates increase, fewer people will be able to buy, and logic says prices will fall if demand decreases. However, history shows us that this has not been the case the last four times mortgage interest rates dramatically increased.
Will Increasing Mortgage Rates Impact Home Prices? | Keeping Current Matters
Bottom Line
 We will have to wait and see what happens as we move forward, but a decrease in home prices should rates go up is anything but guaranteed.
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Your local Northern CO experts at The Noco Group by Revolve Real Estate are here to help you navigate and discuss your personal real estate needs at anytime. Give us a call to get your questions answered. We work with incredible local lenders that we can connect you with to see what your current buying power is in todays market. Give our team a call at 970-302-6793.  Real estate is our trade. People are our passion.

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