Mortgage Rates have risen slightly this week to an national average of 4.27% for a 30 year fixed rate mortgage. Rate are at a two year high as of12/7/16.
Home loan costs have climbed with a surge in the U.S. 10-year Treasury bond yields hit their highest levels since July 2015 last week. This appears directly related to Donald Trump's U.S. presidential election victory. It looks like bond traders are betting on faster economic growth and potentially inflation once the Republicans control both the White House and Congress. The proposed tax cuts with increased federal spending being two reasons for faster economic growth.
The increase in 30-year mortgage rates, which have risen about 0.50 percentage point since the Presidential election has slowed down refinancing applications in many markets.
I find it interesting that weekly mortgage activity excluding seasonal factors, however, jumped 39 percent from the previous week, according to the Mortgage Bankers Association. Looks like people are still bullish on buying homes in many parts of the country.
[dropshadowbox align="none" effect="lifted-both" width="auto" height="" background_color="#ffffff" border_width="1" border_color="#dddddd" ]Additionally the FED has indicated that they may decide to increase interest rates in 2017.[/dropshadowbox]
The market trends are showing that we will be seeing increased mortgage rates in 2017. Exactly how much rates will increase is a guess. The thing that is certain is that with increased rates home buyers ability to purchase homes will decrease. This will lead to two things.
1: Less demand for homes
2: Lower purchase prices for homes due to lower demand
The opportunity for buyers is if the market softens more than rates increase.
If you are thinking of buying a home in 2017 now would be a great time to begin the home search. Depending on where in Washington State you are looking you may already be seeing the beginning of a market adjustment. Evergreen State Homes recommends you speak with your Real Estate Agent and your Mortgage Lender. Together they can help you find the home you want and to position you to take advantage of the market and the increasing mortgage rates.
Of course we are happy to introduce you to a great real estate agent in your market. From Bellingham to Camus , Tri-Cities to Ocean Shores we know some of the top rated most knowledgeable and helpful real estate agents. Call us today and we will pair you up with an agent who will make your home buying experience memorable. If you're looking for a lender we can help too! Fill out a contact form or give us a call today. Evergreen State Homes is here to help!
Happy Holidays to you and yours! Remember this time of year is magical choose to see the good out there.