Thinking about buying a home? Now is the perfect time to act. Mortgage rates have been dropping over the last few months, making new mortgages a great deal, but experts forecast that May 2021 mortgage rates won’t last forever in Alpine, TX. Read on to learn more about mortgage rates—and why you shouldn’t miss this great deal.
Mortgage rates in May 2021
As of May 19, 2021, the mortgage rate dipped down to 3.18 percent. That’s the lowest it’s been since early March. Some lenders, like Freddie Mac, went below 3 percent. Although the economy is growing faster again, don’t expect sub-3-percent mortgage rates to last much longer.
Most experts think that the rebounding economy will probably cause rates to creep back up slowly—by the end of May 2021, they’ll probably all be in the 3.1 percent range. That’s because more companies are hiring again, and thanks to vaccinations and policy support, more people are funneling money into the local and national economies. Inflation, on the other hand, is not expected to rise along with it.
Mortgage rates are expected to stay low for a while, but not forever. Rates are stabilizing, and some experts predict that even if they continue to creep up, it will be a gradual process. The record-low rates we’ve been used to seeing during the COVID-19 pandemic will eventually disappear.
What will happen in the summer and beyond?
As we head into summer, mortgage rates will probably hover around 3 to 3.5 percent. The more money consumers spend, the more housing prices and mortgage rates trend upward. If the economy continues to rebound and inflation rises along with it, mortgage rates should stay steady. However, slower growth is predicted for 2022, which may that there’s a pullback in the second half of this year.
Remember, too, that we’re currently undergoing a major lumber shortage. This has driven the cost of new construction up by the tens of thousands, depending on how large the project is. On the other hand, as the global economy stabilizes, foreign investors may decide to snatch up American properties. That can drive the rates down.
Most lenders predict we’ll end the year with 30-year rates hovering somewhere around 3.5 to 3.7 percent.
Now is the time to act
If you’ve been considering a new home, now is the time to act. Most financial advisors suggest that this is the best time to lock in an ultra-low mortgage rate, especially if you can find something under 3 percent. Even if mortgage rates rise over the next few years, as predicted, we’re still in “historically low” territory. That means your dream home may just be within reach, even if you can’t afford to jump on the current rates. Remember, the historical fixed rate average is usually right around 8 percent.
If the May 2021 mortgage rate forecast has you looking for new homes in Alpine, TX, call Carpenter Real Estate today. We have over 70 years of experience working with homeowners in the area, and we understand this market. We look forward to working with you!