The Mortgage Rate ‘Magic Number’ Homebuyers Are Waiting For
Summary
Mortgage rates in the U.S. have risen to an average of 6.66%, higher than experts expected, making it harder for many people to afford homes. A recent survey shows many potential buyers are waiting for rates to fall to about 5% before they start buying houses.Key Facts
- The average 30-year fixed mortgage rate is currently about 6.66%, up from below 6% earlier in the year.
- Higher mortgage rates have slowed down the U.S. housing market recovery.
- A $400,000 loan at 6.66% costs about $2,568 a month, but at 5% it would cost about $2,147 monthly, saving around $421 each month.
- A survey of 1,000 U.S. adults found that 72% have delayed buying a home, waiting on average 13 months for better mortgage rates.
- Millennials have waited the longest to buy at 14 months, Gen Z has waited 8 months.
- About 34% would buy if rates dropped to 5%, 32% would keep waiting, and 34% are unsure.
- Other reasons people delay buying include economic worries, hope for lower home prices, unaffordable costs, and saving for down payments.
- Experts warn waiting for lower rates could mean paying more for homes later because of rising home prices.
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