Buy now or wait for lower rates? What homebuyers need to know.
As mortgage rates hit a two-year low following the Federal Reserve kicking off its rate easing cycle with a 50 basis point cut, Danielle Hale, Realtor.com's chief economist, joins Alexandra Canal on Wealth! to discuss when is the best time for potential home buyers to make that purchase and offer some affordability tips. Hale tells Yahoo Finance there are pros and cons to buying now and waiting. "Now we're at that seasonal slowdown sweet spot for buyers. So there's less competition which can make it easier to snag a deal on a home. At the same time, you might see lower rates if you wait into the spring. But you might have to offset those lower rates with more competition and better prices. You know, in essence, I don't think buyers can go wrong either way. I think if you're shopping and you have a good idea of what you want, and you find it and it fits within your budget, it makes sense to move forward. If rates do indeed drop further, that may create an opportunity to refinance. But you'll have started building up equity. So buyers are in a really good position right now, the best position that they've seen in quite some time in the housing market." The economist says for buyers looking to get a good deal there are a couple of ways to navigate the current market. "Realtor.com recently did some research looking at listing descriptions [and found] sellers that put the phrase 'priced to sell' or other similar value signals in the listing description are, in fact, more willing to make a deal, and their pricing tends to be better. So shoppers can get an 8.5% or $38,000 discount below the median price, if they're looking for terms like price to sell." For those looking to buy now rather than wait for lower rates, Hale says the number one tip to lower your mortgage rate is "to shop around among mortgage lenders, and that can net you a better mortgage rate than just going with the first offer." For more expert insight and the latest market action, click here to watch this full episode of Wealth! This post was written by Naomi Buchanan.
