The rise and fall of mortgage interest rates seems to be the hot topic on news stations across the country week in and week out. With so much news, and so many differing opinions on what the changes in the rates mean, it can be hard to discern how they will your home purchase.
Over the past few months, there has been a great deal of talk about interest rates and the rise of home prices while inventory remains low and new construction struggles to keep up with demand. Mortgage interest rates have stayed near three percent for months, and the trend is expected to continue while the economy recovers from the coronavirus pandemic. The low rates create the perfect conditions for home buying. However, high demand for housing and low inventory have increased home prices and have recently made it hard for buyers to take advantage of the low rates.
Both home buyers and industry professionals should understand that although there is a possibility rates will rise, they are still at an all-time historic low. If you look back over a 40-year interest rate history, anything below five percent is at the lowest end of the rate spectrum. It is important to keep the current rate changes in perspective and remember to look at the big picture.
The Federal Reserve decided in March to keep its benchmark interest rates low to continue aid to the economy following the pandemic. The decision came after the $1.9 trillion American Rescue Plan was signed adding more stimulus to boost the U.S. economy. With the economic recovery underway, the banks are committed to supporting the economic rebound. This means that historic low interest rates are likely to stick around through 2023.
With interest rates at such a steady low, it is a great time to purchase or refinance a house. Home owners can save money by refinancing existing debt for a lower rate. Low interest rates also mean a more manageable monthly mortgage payment. It is a great time to purchase a home. With rates still at historic lows of less than five percent, now is the time to begin your new Atlanta home search.