Saturday, June 28, 2008

Is Now the Time?

An article in Reality Times posted two days ago offers a picture of what rising mortgage interest rates mean for potential buyers. The article, written by Kenneth Harney, is called Real Estate Outlook: Inflation and Mortgage Rates.

Harney seems pretty optimistic about the state of the economy, and brings up a good point--last year several economists predicted that by now we'd be up to our necks in a serious recession. While recession is still a threat, the economy has remained steady, and some top forecast economists like the Mortgage Bankers Association's Orawin Velz think we'll experience some major economic growth beginning next year. 

That's all good news, but there's still the problem of rising interest rates. Interest rates are going up because of a fear inflation, and there aren't many signs that those rates are going to stop going up anytime soon. 

But prices are down, supply is up, and if you're looking to buy a house or relocate now might be the best time to take that step. There's no way to tell when interest rates will stop rising, and they could get so high that it won't matter how enticingly low home prices are. Making your offer sooner rather than later ensures you'll lock rates before they skyrocket while taking advantage of lower prices. 

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