Mortgage Rates Fall Below 3% for the First Time EVER! This is What it Means for You.
This isn't a drill.
Mortgage rates are now averaging UNDER 3.0%, the lowest ever recorded in Freddie Mac’s fifty-year history. As a result, mortgage lenders are seeing a 16% increase in mortgage applications, in comparison to this week last year.
What does this mean for me?
Buyers can afford to pay (a lot) more for a home than this time last year, while maintaining the same monthly budget.
However, you should leave yourself plenty of time to secure a home that fits your criteria. In addition to the lowest rates ever, we’re also experiencing the lowest home inventory ever. Days on market are shrinking and multiple offers & bidding wars are the norm for most homes, especially those in move-in condition, across all price points and locations in New Jersey. Prior to your search, connect with a Real Estate Agent who’s an expert in the Monmouth & Ocean County area. Make sure they’re responsive, are able to coordinate tours of your favorite homes (the second they hit the market) and knows how to make your offer stand out.
“The demand from buyers was already high before the Covid pandemic slowed down activity, but with such low interest rates even those who were thinking of waiting it out for another year are coming off the sidelines to try and lock in a low rate.” -Amy Dobson, Senior Contributor | Forbes
It’s also important to work with an Agent who takes the time to evaluate each home’s list price vs. the neighborhood’s historical data vs. current market conditions. Some Sellers are using this market to take advantage of Buyers who aren’t familiar with fair market value in their neighborhood. Be very careful not to get caught up in a bidding war that may result in appraisal issues or won’t provide you with equity if you plan to make improvements.
Sellers can expect higher offers and better contract terms.
If you’ve been thinking about selling and have a place to go, don’t let this opportunity pass you by. Undeniably, the time to sell is NOW. (If you skipped the section above regarding Buyers, scroll up and read through it to understand why). In Monmouth & Ocean Counties, over 70% of homes are consistently going under contract within 30 days; and most markets are receiving upwards of 98%+ of asking price.
If you want to cash in on the hot market now but are worried about where you’ll go next, let’s talk about options. Many prospective Buyers are first timers or renters with flexible timelines. It’s typical in this market to negotiate a longer escrow period to give you the time that you need to find your next home.
Homeowners should consider refinancing, if the closing costs vs. expected time in your home are favorable
If you plan on living in your home for another several years, connect with your mortgage lender (or, I can provide you with a list of wonderful companies) to chat about current refinancing rates & closing costs. They’ll give you a breakdown of how long it will take you to break even with closing costs and when you’ll start seeing the return for your lower rate. Even if purchased recently, refinancing can be a great long-term financial decision for you.
Read more about falling mortgage rates in the Forbes Article: “Mortgage Interest Rates Fall To Their Lowest Rate Ever Recorded, Again” - by Amy Dobson.
Looking for a 5-star Experience?
Contact me to schedule a no-obligation virtual consultation, I'll get you on track for your purchase, sale or investment.
Ready to Speak with a Mortgage Lender?
I work with the best! Take a look at my recommended list of mortgage lenders to get started today. Or, contact your bank, a local community bank or a recommendation from a trusted source.
