Will Mortgage Rates Change in 2024?

Real Estate Tips
June 22, 2023

Why are Mortgage Rates Rising in 2023?

In 2023, mortgage rates started to rise because the Federal Reserve raised the base interest rate. Additionally, higher demand means more work for mortgage lenders and brokers, so it will cost more to originate loans because more manpower is required to get the job done.

It also doesn’t help that inflation has been plaguing Americans and hurting their wallets for the past two years. When the economy is not in good condition, the mortgage rates are influenced, and it can ultimately change their direction- for the worst, in some cases.

Will Mortgage Rates Change in 2024?

According to Chief Economist at First American Financial Corp Mark Fleming, it is possible, but it may not happen for several months, and it may not go down by much. Whether you are purchasing a home in 2023 or 2024, it is something to keep in mind, but it’s not something to be scared of- even if you are a first-time homebuyer. There are many programs available to help you obtain a new home, and additionally, it is important to keep your credit and financial situation healthy! Managing your finances will potentially lead to more optimal interest rates.

Is Now a Good Time to Purchase a Home?

Although the rising interest rates may put some homebuyers at a disadvantage, it doesn’t affect everyone. Inventory is not at an all-time high like it was in 2020, but there is still time to purchase a home in 2023. If you intend to stay at the property for some time and invest in your home, its value could appreciate over time, which could outweigh the costs of higher interest rates.

Ultimately, the decision to purchase a home or rental property is completely up to you, and it should be based on your financial goals, current financial situation, and whether or not you want to stay at your new home for a considerable amount of time.