Mortgage Rates are Climbing, What You Need to Know if You’re Looking to Buy or Sell

Mortgage Rates are Climbing, What You Need to Know if You’re Looking to Buy or Sell 

Summer is in full swing, and while we’re excited about beach days and sipping lemonade, it’s also important to stay on top of our financial game. So, grab your favorite fashion-forward swimsuit and get ready to dive into the world of mortgage rates with Wellthi!

Picture this: average mortgage rates are now above 7%, making it the highest level since November. (Wellthi Tip: Why is this important? The higher the interest, the more you’re going to pay for your new house or condo. Buyers beware!)  But fear not, because we’re here to break it down for you, fashionably and confidently 💃🏾.

Ways to save: By creating goals and sharing them in public with your friends and family, you’ll increase your chances of success! You can download the Wellthi app here, and act by July 3, you could win $10,000 for just posting your financial goal in the app!

The average APR for the benchmark 30-year fixed-rate mortgage fell to 7.12% today from 7.17% yesterday. This time last week, the 30-year fixed APR was 7.15%. At the same time, the 15-year fixed mortgage APR sits at 6.56%, the same as it was at this time yesterday. Last week, it was 6.58%. (Rates are quoted as APR.)

The average APR on the 30-year fixed-rate jumbo mortgage is 7.19%. On a 5/1 ARM, the average APR inched down to 7.87% from 7.89%.

This mortgage calculator from one of Wellthi’s bank partners can help you visualize the type of rate you’d can expect based upon your financial situation. 

According to Freddie Mac’s chief economist, Sam Khater, there has been a steady demand for home purchases around rates in the low- to mid-6% range. However, as they edge past 7%, that demand might weaken a bit. But don’t worry, not everyone needs to jump on the homeownership bandwagon. We understand that affordability is key.

Let’s talk numbers. Say you have your eyes set on a fabulous $500,000 home 🏡. With a 10% down payment of $50,000 and a 30-year fixed-rate mortgage locked in at 7%, your monthly payment will add up to around $3,800. Keep in mind that most lenders suggest keeping your housing expenses at or below 30% of your gross income. To comfortably afford that $500,000 dream home, you’d need to be earning at least $152,000 per year. It’s all about finding that perfect balance between style and financial security.

Now, let’s take a closer look at those mortgage rates. The average 30-year fixed rate fell slightly to 7.12% this week. A year ago, the rate stood at a more favorable 5.09%. Now we’re well past the 7% benchmark, which means nearly 5.5 million households are finding themselves priced out of the market compared to a year ago. But remember, it’s not just about the numbers; it’s about finding the right fit for your unique financial situation.

Moving on to 15-year fixed-rate mortgages, the average rate on a 15-year home loan remained steady at 6.56%. A year ago, the 15-year fixed-rate averaged 4.32%. Keep in mind that the national median list price also grew to $441,000 in May, up from $430,000 in April. It’s essential to stay informed about these shifts and make financial decisions that align with your goals.

In the realm of real estate investing, there’s been a record plunge in home purchases by investors. Spooked by elevated interest rates and decreasing rent and housing values, investors bought 48.6% fewer homes in the first quarter of 2023 compared to last year. It’s the largest annual drop on record. While investors still scoop up a significant share of homes, this can present challenges for individual buyers, particularly when there’s limited inventory. But fear not, because we’re here to guide you through these challenges and help you find the perfect home for you.

Lastly, mortgage applications have been on a downward trend, falling 3.7% from last week. The ongoing concerns about inflation and recent economic data have convinced many that the Federal Reserve won’t be cutting rates anytime soon. It’s all about staying informed, adapting to the current financial climate, and making well-informed decisions.

So, Wellthi warriors, as you embrace the summer vibes and soak up the sun, remember that financial awareness is the key to success. We’re here as your supportive friend, providing the knowledge and tools you need to conquer your financial goals. Stay stylish, stay confident, and keep striving for that financial glow-up. With Wellthi, your journey to financial freedom just got a whole lot more fabulous! 💸✨

You can download the Wellthi app here, and act by July 3, you could win $10,000 for just posting your financial goal in the app!

Related Links

The State of the U.S. Housing Market in 2023

Understanding Mortgage Rates and How They Affect Home Buying

Mortgage Rates: What You Need to Know

How Rising Interest Rates Impact Buying Power

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