Finally, good news for hopeful home buyers.
The Federal Reserve is expected to begin lowering interest rates in September, which means mortgage lenders will lower rates as well.
But mortgage rates are already trending down and are expected to continue dropping the rest of this year.
It presents a dilemma for buyers, however, having to decide whether to wait for those lower rates, which could mean losing the home of your dreams.
Shawna Green is not waiting.
This Cincinnnati content creator is bursting with pride, having just purchased her first home with her fiance after a year of looking.
"I love it," she exclaimed.
But she almost didn't get to move into this three-bedroom home, because 8% mortgage rates last fall were too high for their budget.
"When it was that high," she said, "we were like oh yeah this isn't a good time to buy a house."
But with rates now down to their lowest level in a year, buyers like Green are now making their dream happen.
"We actually got under seven," she said. "And it was important for us."
Realtor Michelle Sloan, of RE/MAX Time Realtors, is starting to see buyers finally coming off the sidelines, after a year of waiting.
"A lot of buyers were sick and tired of looking at what their payments would be on the houses that they want, and they actually got out of the market," she said.
So do you jump in now or continue to wait for lower rates?
Holden Lewis of NerdWallet does not suggest trying to time the market for the lowest rate possible.
"What that boils down to is," he said, "if you're shopping for a house and you find a suitable house and you can afford it at today's interest rates, you should just probably buy it."
He said lower rates are never a guarantee, so focus on what you can control, such as improving your credit score and saving up for a bigger down payment.
Plus, Lewis said, lower rates later this year will mean more competition.
"There's going to be more offers, there's going be more bidding wars and so prices might go up," he said.
With lower rates, meantime, NerdWallet is expecting an incoming wave of homeowners with 7 and 8% mortgages wanting to re-finance and lower their monthly payments.
"Let's say you borrowed $300,000 a year ago at 7.5%. If you refinance now and cut that to 6.5% you're going save $200 a month," he said.
Just be sure to factor in closing costs, which can cost another $2,000 upfront.
Michele Sloan said don't wait: if you buy now and rates drop next year below 6%, you could then easily refinance.
Shawna Green is already making plans to refinance next spring.
"Yes, we are definitely looking to refinance when the rates drop even more," she said.
And that way you don't waste your money.
_______________________________
"Don't Waste Your Money" is a registered trademark of Scripps Media, Inc. ("Scripps").
Follow John:
- Facebook:John Matarese Money
- Instagram: @johnmataresemoney
- X/Twitter: @JohnMatarese
Follow Taylor:
- Facebook: Taylor Nimmo
- Instagram:@tnimms
- X/Twitter: @tnimms
For more consumer news and money saving advice, go to www.dontwasteyourmoney.com
