Shani Marbais blog

Navigating Interest Rates as a Home Buyer

Rising Interest Rates May Not Be as Bad as You Think
Posted: June 13, 2022 by Shani Marbais

You've spent the last 6 months swiping through Central Florida house after Central Florida house on and you're ready to finally take the plunge and buy your new home.
But now you're hesitating because you've heard interest rates are on the rise for home buyers in Florida and beyond.
There are two main things every home buyer needs to understand about interest rates in Florida.
1) They're always changing.
2) You're not stuck with one rate forever.
Let's break down number 1. Interest rates are always changing. Sometimes they go up (like they are right now) and other times they go back down! According to NAR, they are projected to continue to rise throughout 2022, so if you're waiting for them to drop so you can buy your dream home in the greater Orlando area before the end of the year, it's probably not going to happen. 
Which brings me to number 2. You are not forever stuck with the interest rate you have at closing.  Ask your local mortgage lender about the process of refinancing in the months and years ahead when interest rates COULD drop again.
This means that maybe you buy a home this year at a 5% interest rate (which, btw, historically is still REALLY good) but next year, your local mortgage lender could call you and say, "Hey, interest rates are going back down right now, and for X amount of dollars, I could get you guys locked in at 3.9%."
So yes, there is some cost associated with refinancing your Central Florida home, BUT it usually pays for itself in a short amount of time with the money you end up saving on interest. *These numbers are completely hypothetical, please consult with a local mortgage lender to determine your specific options.
Bottom line: there is a chance the higher interest rates have made your Central Florida dream home no longer affordable. If that's the case, keep saving up money for a bigger down payment and let's watch for interest rates to drop. But, if you are still able to afford the kind of Central Florida house you want at a higher interest rate, go for it! The higher rates are keeping some home buyers away, so there will be less competition. And you can always refinance when the rates drop!
As always, message me with any questions! I'm always a DM away!

Shani Marbais, Realtor

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