Why the Mortgage Rate Drop Matters Right Now
If you’ve been waiting for an opportunity to buy a home but interest rates have delayed your dream of homeownership, now may be the time. As of August 8, 2024, mortgage rates have begun a downward trend since hitting a 2024 high of 7.22% in May, according to Forbes. Economists predict another rate cut this fall, and the decline could alleviate pressure on the market for prospective home buyers.
But if lower mortgage rates prompt homebuyers to make a move even while inventory is still very low in the market of existing homes for sale, they may find there is still limited availability and existing home prices haven’t decreased. It makes sense that buyers might want to take advantage of some excellent opportunities to purchase new construction in southern New Hampshire.
The unique benefit when it comes to buying new construction homes is that they’re not dependent on current owners deciding whether it’s a good time for them to sell their home or move. Our team at LaMontagne Builders is actively building new homes in cities and towns across southern New Hampshire.
For buyers with significant equity in their current home, mortgage rates may have a small impact on your new home purchase. If you’re trading across or slightly up-market from your existing home, you may find that your total mortgage is quite low, and you could benefit from a better 15-year fixed rate, or have no mortgage at all.
Aside from the availability of homes on the market, there are some indirect cost savings for new home buyers when they decide to purchase new construction real estate. All of the plumbing and electrical work, the roof, furnace, and major appliances are all new and won’t need to be replaced for a long time. When home buyers purchase existing homes, the costs can easily escalate far beyond the sale price once repairs and replacements are factored in.
As interest rates drop with slowing inflation, new home buyers taking on a 30-year mortgage now can anticipate a future opportunity to refinance at a lower rate. It doesn’t hurt to see what your options are for new construction communities. Take a tour and ask questions. In the meantime, keep your eyes on the market and watch for movement in mortgage rates so you’ll be ready when you decide it’s time to buy.
