Buying property can seem like a risky proposition to many South Florida residents, especially when the national housing market is still in a state of flux as the slow but steady recovery continues. For many, the thought of signing a 30-year mortgage can be off-putting, given the economic circumstances in many markets. However, according to a recent report, the recent turnaround in interest rates – for those who don’t know, they are rising – has apparently begun to spur many buyers into taking the leap into the market.
The report noted the recent increase in 30-year mortgage interest rates to 4.46 percent – a sharp jump by many people’s standards, especially given that rates have been in the area of 3 percent for quite a long time. However, while an increase in interest rates may seem like bad news, there was a bit of good news that could be associated with the rise – buyers are sensing that the time to get into the market is now, before rates get too high.
It was noted that recent data on the pending sales of previously owned homes showed a jump to a six-year high over the last several months. Specially, in the month of May the numbers were approximately 12 percent higher than the numbers from May of last year. And, from April to May of this year, pending sales increased 6.7 percent.
Trepidation about getting into the housing market is understandable, especially given the economic circumstances of recent years. However, as South Florida residents have probably noticed, recover in some areas occurs faster than others, so waiting and waiting for a “bottoming out” of the market may not be the best move for buyers anymore.
Source: Forbes, “Pending Home Sales Hit 6-Year High As Rising Mortgage Rates Propel Home Buyers,”