With mortgage rates on a slow rise and prices rolled back to where they were a decade ago, this fall would seem an ideal time for first-time buyers to finally take the plunge or to refinance your home.
An inventory shortage has whipped up a feeding frenzy in some housing markets, with bidding wars and price increases. Is this pressure justified? Would most buyers be better served by waiting? NO! If you can’t afford to buy now in this great market then refinance. Your appraisal value may rise due to the home values increases as well.
In this installment of Buying Advice, we’ll look at what’s driving the shortage and how that picture is likely to change in the months ahead. Where does “Act now!” make sense, and where should buyers sit it out awhile?
Housing market snapshot
Just how high have mortgage rates risen? In the week that ended June 26, the average rate on a 30-year fixed-rate loan was 4.00% which is up from 3.49% from last year, according to Freddie Mac survey data.
“Despite the frictions related to obtaining mortgages, buyer interest remains solid,” Says the Greater Springfield Board of Realtors. “But inventory continues to shrink, and that is limiting buying opportunities. That in turn is pushing up prices in many markets,” as is a reduced supply of lower-priced distressed listings. Prices increased the most in the West 13.3% year over year – due to short supply of affordable and mid-tier homes. Here in Springfield and in our surrounding communities our inventory is still looking good but as we get closer to school starting we may see a drop in listings.
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