Good news for homebuyers! The recent drop in federal interest rates could be a game-changer for those looking to enter the real estate market. Here’s why:
Lower interest rates mean cheaper borrowing costs. If you’re looking to finance a home, the reduced rates translate to lower monthly mortgage payments, in turn making it more appealing to purchase a home without stretching your budget. Over the life of a mortgage, even a small rate drop can save you thousands of dollars.
Keep in mind that a rate drop could increase competition in the housing market, as more buyers are enticed to make a move. With more people shopping for homes, it may limit inventory and your options to enter the market. It is important to be prepared by speaking with a local lender prior to starting your Outer Banks home search.
Buyers who purchase now benefit from stable prices and the increased inventory that has been building over recent months. There are also creative solutions to obtaining today’s lowest available rates such as Adjustable-Rate Mortgages or purchasing with a conventional mortgage now with the intention of refinancing later to lower your monthly payments or shortening the term of your loan. Borrowing at a little higher rate now as rates are forecast to decrease into 2025, may be more beneficial than waiting for lower rates which will likely be offset by increasing demand and prices in the future.
The federal interest rate drop is a positive shift for real estate buyers, making homes more affordable and allowing more people to enter the market. If you’re considering buying, now may be the perfect time to act!
Contact a NC 12 Realty Broker for more information on how to start your Outer Banks property search.