As mortgages rates rise, is renting better than buying?
Should prospective first-time home buyers just sign another apartment lease this autumn and forget about the dream of homeownership?
While mortgage rates declined slightly on
"Mortgage rates decreased slightly last week due to ongoing economic uncertainty," said
Fifteen-year fixed-rate mortgages averaged 5.90% on
November Fed rate hike?
The next Fed funds rate-hike meeting is scheduled for
What all this Fed action means is prospective home buyers likely will see 30-year mortgage rates rise to 7% or more by November. Fall home buying outlook Despite the threat of higher mortgage rates, there are several key advantages of buying a home in the fall, according to veteran broker
"Buyers face steeper competition in the summer due to favorable weather and families with children trying to time their moves to not coincide with the school year. By the time classes are underway in the fall, fewer families are actively looking to move," Kasal said.
Weather conditions still tend to be favorable for touring properties and moving in the fall, and the inventory of homes at this time of year is generally higher than what buyers will experience heading into the winter, Kasal said.
"Home buyers may be able to find better deals in the fall, depending on the market," Kasal said. "Sellers that didn't find buyers during the busy summer months are often more inclined to lower their asking prices and make deals by the time autumn rolls around-especially if they want to avoid moving as winter weather (and the holidays) arrive."
Because the autumn market tends to have a lower overall volume of sales compared to the spring and summer, Kasal noted that buyers can benefit from more personalized attention from real estate agents, attorneys, title companies and home inspectors. This likely would lead to a better shopping experience as well as quicker and smoother closings.
"Buyers who purchase in the fall can also take advantage of relatively lower demand for contractors and movers and find better deals when it comes to repairs and moving costs," Kasal said.
Home improvements are more affordable-and likely to be completed quicker-in the fall than in the summer when contractors are in the highest demand.
"Both sellers and buyers may see tax benefits by making a deal in the fall. Property tax and mortgage interest paid at closing can be deducted from your income for the year, even if you closed on the home late in the year," Kasal said.
"For some buyers, these deductions can significantly affect the year's tax liability. However, we always recommend a buyer contact a tax professional to see how these may impact their tax situation."
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