Mortgage preapproval first-time homebuyers
If you’re a first-time homebuyer, here’s how to get a mortgage preapproved.
What would it take for you to bite the bullet and finally buy a home, or sell your current home for something that better suits your needs?
For most people, it wouldn’t be a sudden uptick in housing inventory or a drastic decrease in home prices — though, that would probably help. Instead, according to a new survey from Bankrate, many buyers say they’re waiting for mortgage rates to decrease.
With mortgage rates being more than double what they were in 2022, and worlds away from the record low rates we saw in 2020 and 2021, this has caused what is known as the “mortgage lock-in effect.” Homeowners who purchased or refinanced a home, for those low rates are sticking with them. And first-time buyers are choosing to sit on the sidelines, hoping they’ll see rates drop back down.
“Expectations about mortgage rates keep changing. The U.S. economy is still going strong, and the Federal Reserve keeps putting off its first rate cut,” said Bankrate Analyst Jeff Ostrowski. “Add those things together, and the consensus is that mortgage rates will remain in the range of 5.5% to 7% by the end of 2024.”
What mortgage rates are homebuyers waiting for?
Of the homeowners surveyed by Bankrate, 52% of respondents said mortgage rates need to drop below 6% for them to be motivated to buy a house this year.
Then 47% of respondents said they’d prefer for rates to drop below 5%; 38% of respondents said they want rates to drop below 4%; and 20% of respondents said they’re waiting for rates to drop below 3%.
And about 38% of respondents said that there is no mortgage rate that would make them comfortable buying a home this year, according to the survey.
For first-time buyers, 31% said they’d consider buying a home this year if mortgage rates dropped below 5%, while 25% said they want mortgage rates to drop below 4%.
“The hopes for lower interest rates need the reality check that ‘lower’ doesn’t mean we’re going back to 3% mortgage rates,” said Bankrate’s Chief Financial Analyst Greg McBride.
What mortgage rates are sellers waiting for?
For homeowners who are locked into low mortgage rates, Bankrate found that 35% of respondents want rates to be less than 6% before they’d feel comfortable selling their home.
About 30% of respondents want mortgage rates to be below 5%; 21% of respondents want mortgage rates to be less than 4%; and 11% of respondents want rates to be below 3%.
And 42% of respondents said there’s no mortgage rate that would make them comfortable selling their home this year, while just 5% said they’d be comfortable selling their home with mortgage rates at 6% or higher.
“The mortgage lock-in effect has frozen home sales for the past couple of years. Alas, these results don’t bode well for an unfreezing of the market,” Ostrowski said. “Many homeowners aren’t keen to sell at all, and many would-be buyers are waiting for mortgage rates to dip below 6%.”
Maddie McGay is the real estate reporter for NorthJersey.com and The Record, covering all things worth celebrating about living in North Jersey. Find her on Instagram @maddiemcgay, on X @maddiemcgayy, and sign up for her North Jersey Living newsletter. Do you have a tip, trend or terrific house she should know about? Email her at MMcGay@gannett.
What mortgage rates would make more buyers enter the housing market? #mortgage #rates #buyers #enter #housing #market
Source Link: https://www.northjersey.com/story/money/real-estate/2024/07/27/what-mortgage-rates-would-make-more-buyers-enter-the-housing-market/74525307007/
What mortgage rates would make more buyers enter the housing market? – Notice Important Web – #Market – BLOGGER – Market, buyers, enter, housing, Important, Market, Mortgage, Notice, Rates, Web
Mortgage preapproval first-time homebuyers If you’re a first-time homebuyer, here’s how to intend a mortgage preapproved. What would it verify for you to ache the missile and eventually acquire a home, or delude your underway bag for something that meliorate suits your needs? For most people, it wouldn’t be a explosive dealing in structure listing …
