Mortgage payments will more than double by 2022, but home buyers will soon get relief from high loan rates.
Nadia Evangelou, senior economist and director of forecasting at the National Association of Realtors (NAR), predicts that the mortgage will fall below 6% in the spring and summer months of the 2023. He mentioned the reduction of the price and the small. rate hike by the Federal Reserve for the reason of the fall it seems.
This week, the average rate on a 30-year fixed-rate mortgage was 6.48%, according to records from Freddie Mac. The ratio means that the buyer of an affordable home (one worth about $416,000 currently, according to Realtor.com) faces a mortgage payment of 64%. higher than last year, Realtor.com senior economist George. Ratiu said what blog post this week.
Evangelou expects rates to be around 5.7% in 2023. That’s significantly higher than the rate of around 3.5% seen by investors in the first months of 2022. , but it’s also a far cry from the rate that climbed above 7% last fall.
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Falling mortgage rates will improve housing affordability
“The housing affordability will be the main driver of the housing market in 2023,” Evangelou said in an emailed statement shared with Money.
He noted that the mortgage rate is around 6% which means that many families can afford to buy houses this year, but add others – especially. first home buyer — will continue to struggle.
Maybe that’s the case anyway the high cost of housing this year. Discontinuation of sales, which is expected to increase as more buyers enter the market while sitting side-by-side with let the prices fall further, this is the problem.
“The market is likely to be more competitive in the next few months,” Seattle Redfin representative Shoshana Godwin said in a statement. blog post on Thursday. “I expect that new listings will remain scarce as homeowners hold on to low interest rates while the pool of potential buyers circles the few available homes.”
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