The Federal Reserve recently decided to raise its short-term interest rate by a quarter of a percentage point once again. While that might not seem like a big change, it could end up making an impact on those buying homes as well as for those with variable rate mortgages.
The average interest rate on a 30-year fixed mortgage rate hit a high for 2017 shortly after the Federal Reserve’s announcement, jumping to 4.21 percent. According to CNN, that means that homebuyers will end up paying roughly $57 more per month for a mortgage right now than they would have if they obtained a mortgage one year ago when also factoring in the Fed’s last rate hike. It also means that anyone with a variable rate mortgage will see an increase in their payments in the coming months.
The good news for everyone out there thinking about buying a home at the moment, though, is that the Federal Reserve interest rate hike did not come out of the blue. Instead, industry analysts have been predicting a jump in the interest rate for months now. Although it’s only the third time the Federal Reserve has raised rates since 2015 ended, it’s not necessarily a reason to panic. Mortgage rates are actually still very low, and real estate experts don’t think they are going to top 5 percent at any point in 2017.
With that in mind, now is a good time for potential homebuyers to test the market and see what they can get for their money. The Federal Reserve’s decision to increase interest rates shouldn’t scare you off if you are in the market for a new home. Rather, it’s a sign of a regrowing and rebounding economy and a sign of economic confidence – a good sign for buyers, sellers and owners alike.
Berkshire Property Agents can help you find the perfect new home in the Berkshires region. We understand the anxiety and stress that often comes along with home shopping, especially when things like interest rates become a concern. Our experts can help talk you through the process, discuss your options, discover your needs and help find properties that meet your goals and your budget. Schedule an appointment with one of our agents today by calling 413-528-6800.