With federal regulators deciding this week to hold off again on any interest rate hike, homeowners and home buyers still have an opportunity to take advantage of record-low mortgage rates.
“It’s a great time to refinance,” said Jim Whitehouse, executive vice president of Suffolk County National Bank. “The bond market took off [after Wednesday’s rate announcement] so the rates went down again.”
And if you’ve been dreaming of buying a new home? It’s a good time for that, as well. But signs indicate that you may want to move forward sooner, rather than later.
“Rates are a cycle and sooner or later they have to go up,” Bridgehampton National Bank vice president Beth Flanagan said. “It’s going to get better for savers and a little harder for borrowers.”
There has not been a rate hike since the housing boom in 2006; currently the
federal funds rate is at its low point since the crash of 2008. With a strong U.S. dollar and an economy that’s seeing steady growth, analysts are expecting the fed to nudge the rate up, perhaps as soon as April or June.
While regulators can raise the rates at any time, Whitehouse said he doesn’t think they will do so this spring.
“Improved buyer demand” in early 2015 pushed pending home sales in January to their highest national level since August 2013, according to the National Association of Realtors.
Though prices are still lower than pre-bubble burst levels, there has been a steady increase.
The national median existing-home price is expected to increase near 5 percent this year, the National Association of Realtors said in a press release last month. In 2014, existing-home sales declined 2.9 percent and prices rose 5.7 percent.”
People looking for the perfect home may want to start shopping. Traditionally, “the real estate market picks up in the spring,” Whitehouse said. If you think the time is right to get into the home of your dreams, Whitehouse suggests that you “hook up with a local realtor.”