If you’re thinking about buying a home in Southern California, you’re probably wondering how rising mortgage rates will affect your monthly payments. The good news is that even with higher rates, buying a home in can still be a great investment. The bad news is that you may have to pay more for your monthly mortgage payment.
Here’s a look at how changing mortgage rates can affect you in California:
How Mortgage Rates Affect Your Monthly Payment
Mortgage rates are one of the biggest factors that affect your monthly mortgage payment. When rates go up, your monthly payment will go up. And when rates go down, your monthly payment will go down.
For example, let’s say you’re buying a $500,000 home with a 30-year fixed-rate mortgage. If the interest rate is 3%, your monthly payment would be $2,077. But if the interest rate goes up to 4%, your monthly payment would go up to $2,271. That’s an increase of $204 per month. Calculate your payments here
How Rising Mortgage Rates Affect Home Prices
Rising mortgage rates can also affect home prices. When rates go up, it becomes more expensive to borrow money to buy a home. This can lead to a decrease in demand for homes, which can push prices down.
However, there are other factors that can also affect home prices, such as the supply of homes for sale and the overall health of the economy. So, it’s possible that rising mortgage rates could have a minimal impact on home prices in Southern California.
What to Do If You’re Concerned About Rising Mortgage Rates
If you’re concerned about rising mortgage rates, there are a few things you can do. First, you can try to lock in a lower interest rate by getting a mortgage pre-approval. This will give you an idea of what your monthly payment would be at different interest rates.
Second, you can consider buying a home that’s less expensive. This will lower your monthly mortgage payment, even if rates go up.
Finally, you can save up more money for a down payment. A larger down payment will lower your monthly mortgage payment because you’ll be borrowing less money.
Rising Mortgage Rates: What to Expect
It’s difficult to say for sure how rising mortgage rates will affect the Irvine real estate market. However, it’s likely that prices will continue to rise, albeit at a slower pace. The economy is strong, and there is still a lot of demand for homes. So, even with higher rates, buying a home in Irvine can still be a great investment.
If you’re thinking about buying a home contact one of our real estate agents today to learn more about how changing mortgage rates can affect you in Southern California