The Outlook for Mortgage Rates: What Buyers Should Know
December 4, 2024
Tim Sharkey, Founder – Sharkey Real Estate
As we navigate the ever-changing landscape of the U.S. housing market, mortgage rates have been nothing short of unpredictable in the second half of the year. This past summer, the average 30-year fixed mortgage rate trended downward, only to inch back up in the fall. Now, rates have dipped again, but the volatility has left many buyers wondering: should you lock in your rate now or float it and wait for a potential drop?
The answer to that question depends heavily on your personal financial situation and how much risk you’re willing—and able—to take. For some, locking in may provide much-needed stability. For others, waiting could present an opportunity to secure a better rate.
As mortgage expert Kevin Leibowitz of Grayton Mortgage explains, timing your rate lock can be crucial. “You and I are not in control of what the interest rates are going to be,” Leibowitz says. If a small increase in rates would affect your ability to qualify for your mortgage, locking in early might be the safest option. “You don’t want to roll the dice and see what happens if it means jeopardizing your ability to close,” he adds.
For buyers with more flexibility, there may be opportunities to benefit from rate fluctuations. This past November, when rates were at a cyclical high, Leibowitz advised some clients to hold off on locking in their rates. His strategy? Let the market settle, observe how the Federal Reserve’s commentary shapes the economic outlook, and consider locking in December, either before or after the next Fed announcement.
For our buyers, the takeaway is this: while no one can predict where rates will go with certainty, your approach should align with your financial situation and tolerance for risk. If you’re on the edge of qualifying, locking in might be the right move for peace of mind. If you have a little more room to maneuver, watching the market and waiting for the right moment could save you money in the long run.
As always, our team is here to help guide you through these decisions and connect you with trusted mortgage professionals. Together, we can ensure your home buying journey is as smooth and stress-free as possible. Feel free to reach out with questions or to discuss your options further!