Interest rates on mortgages increase

Published: Sep. 23, 2022 at 10:17 PM CDT
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BAY COUNTY, Fla. (WJHG/WECP) -Interest rates are going up. So if you are in the market to buy a home what you can afford now might be different.

“As interest rates go up their payment is going to go higher so they are going to be able to afford less house. The house is going to be priced lower to keep them in that same payment. So interest rates have affected the buying power of buyers,” President of the Central Panhandle Association of Realtors, Susan West said.

Tonya Anderson a mortgage loan originator, with Tyndall Federal Credit Union, said depending on the lender and the program interest rates right now are sitting at 6.5% on a 30-year conditional mortgage. But earlier this year around January Anderson said rates were in the low 4% range.

“So the feds have hiked the rates quite a bit this year. Most recently three-quarters of a point so that is about a 2.25% increase just since the beginning of 2022,” Anderson said.

While interest rates are increasing, housing prices are coming down but not to pre-pandemic prices.

“Prices this year compared to pre-pandemic are up almost double they are up 47%. So even though they have come down a little bit since the peak and the peak was February/March of this year, we are still much higher than we were pre-pandemic,” West said.

So if you are looking at buying a home right now here is a piece of advice.

“Find a lender that is willing to sit down whether it is in the office or over the phone and discuss the process, because buying a house is generally the biggest financial decision people will make in a lifetime,” Anderson said.

Anderson also said depending on your personal financial situation now may still be a good time to buy. with a possibility of refinancing in the future for a lower rate and a lower payment

West said this year to date, 30% of their transactions that have been sold have been in cash. That means there are no interest rates they have to pay.