Rising Interest Rates
If you have had your eye on Camarillo homes coming soon you have likely noticed the rise in mortgage interest rates. The fluctuation in mortgage interest rates since the beginning of 2022 has risen at unprecedented rates. In fact, rates have risen even faster and higher than expert predictions previously stated. This is the first time since 2011 that mortgage rates have been above 5%. There is little reason for a homeowner to refinance at this time other than a cash out refinance in order to fund a high balance credit card or something similar.
As of today May 4th, 2022 the average 30-year fixed rates are set at 5.5%. This significantly affects a homeowner’s ability to purchase a new home and the purchase price that a family will qualify for. A 15-year mortgage is currently at 4.71% with a 5/1 adjustable at 3.77%. What this means for a homeowner in real numbers is that for 800,000 loan at 3% (rates available earlier in 2022) the principal and interest rate payment is $3,372.83. For the same loan today at 5.5% the principal and interest payment is $4,542.31. This is nearly $1,200 more per month just in interest alone. This significant hike in interest rates means the difference of someone qualifying or not qualifying for a home.
While it may intuitively seem that home prices will have to fall because of the interest rates rising, this is not happening – yet. There is still a significantly mismatched market when it comes to supply and demand. As long as the demand for homes far outweighs the supply of homes available values will continue to increase. If you have been searching for Camarillo homes coming soon our team would be happy to help you navigate the rise in interest rates and demanding real estate market. Please let us know if you have questions on how to get the process started.