Mortgage interest rates have been at historic lows for a while now, but in the past year or so, they’ve been rising and have been a bit unstable.
The great news is that now that we’re entering the spring buying season, mortgage rates are beginning to stabilize at rates that are really quite excellent. At present, the rates are expected to be 4.48% by June (an average of Fannie Mae, Freddie Mac, Mortgage Banker Association and the National Association of Realtors projections). Projections are that rates will climb to 4.73% by the end of the year.
This might not seem like much, but the lifetime difference is significant. The median home price in Las Vegas is $254,732.
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The difference in the monthly payment is $38 every month.
The lifetime difference is $13,705.
That $13,705 is about the same price as adding a sunroom to your home.
How to Lock in the Lower Rate
All home buying should start with a pre-approval of a mortgage. Once you have that in hand, you’ll know how much house you can afford to buy. The lender will likely lock in the rate that you’re using for your estimate for a set period of time.
Once you’ve locked in that rate, you can proceed with looking for a house that meets your needs.
Once you have your mortgage commitment, the key is to find a real estate agent that can match that amount of funding with the needs that you have for a home.
Why buy a house this year?
According to economists, the mortgage rates will continue to rise from now into the foreseeable future.
Michael Fratantoni, chief economist with the Mortgage Bankers Association, rates are expected to rise to 5 percent by 2019 and 5.3% in 2020. That will mean that by 2020, the same home will cost you $1,415 per month with a total cost of $509,234. This means that this house will cost you $45,675 more in two years than it does now!
Buy a house now
Now is a great time to buy a house. Save yourself a lot of money over the course of your mortgage.
Inventory is low in the Las Vegas area, so the search might take some time. Starting now can save you tens of thousands of dollars over the next few decades.