Published November 28, 2022
How Interest Rates Impact Your Buying Power
What buyers need to hear about recent interest rate changes.
Have you heard that the Federal Reserve raised interest rates again? Since they increased their rate by 75 basis points, everyone assumes that mortgage rates will rise too. However, current mortgage rates had the recent Fed increase “baked in.”
In other words, the mortgage market knew this increase was coming and adjusted its rates beforehand. Currently, we’re seeing interest rates somewhere between 6.5% and 7.5%, depending on your credit and other factors. Just a few weeks ago, no one could get a rate as low as 6.5%, so now might actually be the perfect time for you to get off the couch and start looking for homes again.
"Homes just became 11% more affordable, but it likely won’t be for long."
The truth is that no one knows how long this short drop in rates will last. Every 1% change in mortgage rates is equal to an 11% change in your buying power. That means homes just became 11% more affordable, but it likely won’t be for long. This is huge, but we don’t know how long the rates will stay where they are. There's every reason to think they'll go up eventually. Call or email us if you are interested in buying or have any questions. We look forward to hearing from you.
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