Rosalind Evans
The quest for homeownership has hit rough waters, with mortgage rates reaching daunting heights unseen in over two decades. Despite these financial tempests, determined buyers continue to set sail in the housing market, seeking ways to stretch their budgets and navigate the surge in interest rates. NerdWallet, tapping into the wisdom of seasoned real estate professionals, unveils nine tactics to help buyers keep their homebuying dreams afloat.
Strategic Financing and Homebuying Tips for Weathering High Mortgage Rates
The 30-year fixed rate’s climb beyond 7% has led experts like John Bianchi of loanDepot to endorse temporary rate buydowns—a tool where sellers pay part of the buyer’s interest, easing payment burdens early on. Chuck Vander Stelt from Valparaiso suggests an intriguing trade: a higher home price for sizeable rate-lowering concessions. Additionally, David Kuiper of Dart Bank advises diverting some down payment funds to settle higher-interest debts, which may lead to more favourable loan conditions.
Homebuyer assistance programs offer a lifeline, from down payment assistance to tax credits. The trick is to navigate the local offerings diligently. Meanwhile, seller financing emerges as a throwback solution, with Janie Coffey of eXp Realty noting its advantages in securing desirable prices for both parties. However, caution and legal guidance are paramount due to its complexity.
Yet, it’s not just about interest rates. Brian Koss from Movement Mortgage recommends considering homes that need work, which could promise significant savings. Jeffrey Ruben of WSFS Mortgage points to the advantages of new constructions—certainty of costs and move-in timelines and potentially lower long-term expenses.
Lastly, the concept of house hacking presented by Coffey—where buying a multi-unit property can offset costs via rental income—adds an innovative dimension to traditional home-buying strategies.
A Course to Homeownership Amidst Rising Rates
Homebuyers today may face high mortgage rates, but with strategic thinking and creativity, the dream of owning a home is still possible. It’s a matter of employing tactics like rate buydowns, utilizing assistance programs, or even becoming a landlord that can turn the tide. In a constantly ebbing and flowing market, these maneuvers may help buyers anchor down their piece of paradise.
