When purchasing a home, there are a number of variables that may influence or even dictate which home the buyer can afford. Obviously the price of the home, the property taxes for a specific home as well as how much money the buyer has to use as a down payment all are important factors for home buyers to consider when zeroing in on a home to purchase. However, there is another variable that truly can vary and that is the mortgage interest rate.
For the past several years, buyers in the US have been spoiled by rates that hovered near record low interest rates. Small upticks in the rates may have alarmed some home buyers that disappointed to see how it changed their monthly payment. Obviously, as the interest rates for mortgages increase, the monthly payment also increases and it could be a deal breaker for some buyers. This is why it is important for prospective home buyers to continue to be aware of interest rates fluctuations.
Unfortunately, based on an article published in Keeping Current Matters “Where are Interest Rates Headed in 2019?”, Freddie Mac is expecting rates to continue to increase throughout 2019. Nevertheless, even if rates inch closer to 5.3 by the end of 2019, a glance back at the history of rates in the US over the past 40 or so years may offer a bit of relief. It is still nowhere near the 18% homeowners in the 1980s had to work with.
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