With the advent of spring, eager prospective buyers are trying to find the best deal on the perfect home. While each year brings new challenges, this year is marked by low inventory and rising prices. Industry professionals expect this trend to continue. Although rising prices can make affordability a major concern, this is being offset by near-record low interest rates.
These recent low rates and a strong labor market encouraged more buyers to enter the housing market, as the drop may be temporary should the Federal Reserve raise interest rates as expected. According to the mortgage banking industry trade association, buyers took full advantage of the current favorable situation. Total mortgage applications surged 10 percent last week on a seasonally adjusted basis. Continuing their upward trend, refinance applications rose 11 percent. Mortgage applications for the purchase of a new home, which have fallen in recent weeks, did a sharp turnaround rising a strong 9 percent. The applications reached the second-highest level since 2010. Buyers who missed an opportunity to lock in low rates back in February were able to take advantage of these new low rates. The sharp increase in sales may encourage more sellers to list their homes in response to the stronger housing market.
Low interest rates are fueling an increased demand for housing. A professional real estate agent can help sellers find the right opportunity to sell at a fair price while showing buyers how to take advantage of some of the best mortgage rates in years.