The Mortgage Bankers Association recently published their Mortgage Market Forecast for 2022, and the general consensus is that the cost of buying a home is expected to increase.
At the close of Q3 2021, the median interest rate was 2.8%. Going forward, MBA forecasts the following steady rate increase through the end of 2022:
2021 Q3: 2.8%
2022 Q1: 3.4%
(Source: Mortgage Bankers Association)
Expected 43% Increase in Interest Rate
From a historical standpoint, a 4% interest rate is still fantastic, however it represents nearly a 43% increase from today!
For example: a Buyer who qualifies for a $650,000 purchase today (2.8%) would only qualify for around $550,000 at the end of 2022 (all other things being equal).
If you’re interested in further reading, you can access all of MBA’s recent forecast/reports here: Mortgage Bankers Association Market Forecast
For most, interest rates are not the primary driver for why they choose to purchase real estate. That said, it is arguably the most impactful element of homeownership and should be given special consideration.
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