Mortgage Rates Today For First Time Home Buyers

Mortgage Rates Today For First Time Home Buyers – Ron Magoon has a clear view of New Hampshire’s small bank residential mortgage market today. The president and CEO of Franklin Savings Bank said, “It’s very big.”

Home prices remain at historic highs in the state and unsecured purchases continue to dominate home sales. Rising gas prices and gas prices increase daily expenses, making the prospect of large home loans exciting.

Mortgage Rates Today For First Time Home Buyers

“The cost of obtaining a mortgage and the affordability of mortgages have changed dramatically for a number of reasons,” Magoon said.

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This year, home buyers face another challenge: the cost of home mortgages is rising. At the end of 2021, the 30-year fixed mortgage rate increased to 3.1 percent. For someone buying a $400,000 home with a 5% down payment, that’s $1,623 a month for 30 years, according to the New Hampshire Housing Finance Authority.

At the beginning of June, that interest rate was 5.5 percent. A buyer who bought the same home today would pay $2,158 a month, the Home Finance Administration found in its monthly report.

As mortgage rates rise, so do monthly payments on 30-year fixed mortgages. (See: NH Housing Market Report from the New Hampshire Housing Finance Authority, June 2022)

“Prices are not historically high, but they are higher than they have been in a while,” said Rod Dappis, CEO of the New Hampshire Housing Finance Authority.

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As inflation continues to rise and the Federal Reserve continues to raise the federal funds rate to match it, rates have followed suit.Mortgage Rates in New Hampshire. Some real estate experts hope this will help offset the drop in sales over the past two years.

“As mortgage rates rise, they put products on the market for a while, which makes the search process easier,” said Suzanne Damon, a broker with Re/Max Damon.Home Team in Manchester. “We are now seeing a decline in the pace of house price growth.”

“Because right now consumers are facing a double whammy: prices are rising and prices are rising,” he said.

But this slowdown could come at a cost: Higher interest rates could make it more expensive for low- and middle-income homebuyers. Even if the housing market begins to stabilize in the long term, these homebuyers will likely be pushed into the rental market in the short term.

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“A lot of people can’t afford more, which puts a lot of homebuyers out of the market,” Dapis said. “…That destroys demand and, unfortunately, the destroyed demand falls below the market.”

Magoon agrees. “For those on the fence trying to find a home they can afford – it’s not available to many of them right now.”

Housing prices in the state are rising to new records. (See: NH Housing Market Report from the New Hampshire Housing Finance Authority, June 2022)

The double-edged sword highlights a critical problem in the Granite State: Even though restrictive tax policies have slowed unprecedented demand here, the state doesn’t have enough housing to rein in home prices or demand will stabilize in the near future, officials say. observers. .

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“The record has dropped over the last 10 years to very low standards,” Dapis said. “It seems like it has reached a point. This will give a little more choice to people who can afford to buy, but it won’t help many people who are feeling the impact of the housing market.

The higher rates come as the Federal Reserve signaled its intention to raise the federal funds rate again this week, after last week’s data showed the economy had been accelerating since 1981. The big increase came after the Fed raised interest rates by half a percentage point in May, StreetJournal reported on Monday.

These rate increases have already changed the behavior of many marble stators. According to the Home Finance Administration, the number of families refinancing their homes fell 55 percent between April 2021 and June 2022, after growing rapidly during the previous two-year period.

High prices have not slowed the market’s abandonment rate of new home listings. According to the Housing Finance Authority, the state’s current listings will be sold out within a month if no new listings come online — most under the rate is six months. Despite the expected increase in summer rentals, the number of rentals remains at the lowest level in the last 10 years.

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But if sales continue at a rapid pace, buyers’ power will be diminished. Realtors reported that in 2020 and 2021, the number of buyers who used to flock to a typical listing decreased to three or four. The economic situation appears to have been affected.

The number of home leases in New Hampshire is less than 10 years. (See: NH Housing Market Report from the New Hampshire Housing Finance Authority, June 2022)

Inflation also affects the real estate market. The cost of building materials has been very high in recent years and inflation will make construction difficult and slow down the delivery of new homes. New permits for single-family homes reached a 13-year high in 2021 but have slowed in recent months.

Meanwhile, higher prices could reduce buyers’ ability to afford higher monthly mortgage payments — deterring some buyers, Dapis added.

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“Builders are being squeezed from both sides because their costs are rising in terms of labor and materials,” said Dapis. “Their ability to buy and pay is reduced because prices are high.”

High prices can create shortages for some families who consider housing unaffordable. But Damon says it benefits others – especially people who use government programs to finance their purchases and financing. With fewer buyers looking for listings, these sellers have had more success recently.

“I think what this will do to help our market is be able to compete a little more with FHA buyers, (Veterans Affairs) buyers, our federally financed buyers and buyers starting out with first-time home buying programs. . In the market,” he said. “I think it helps a lot.”

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Ethan DeWitt is the education writer for the New Hampshire Bullet. Previously, he was a New Hampshire State House reporter for the Concord Monitor, covering the state, the legislature and the New Hampshire presidential primary. Westmoreland native Ethan Keane began his career as a political and health reporter at the Sentinel. Email: [email protected]When it comes to buying a home, there are many different types of mortgages available to first-time home buyers. One type of mortgage that has become more popular in recent years is the interest-only mortgage. This type of mortgage allows home buyers to pay only the interest on the loan for a set period of time, usually five to ten years, before the principal begins to be paid. While an interest-only mortgage can be a great option for some homebuyers, it’s important to understand the pros and cons before deciding if it’s right for you.

1. Lower monthly payments: One of the biggest benefits of an interest-only mortgage is that it offers lower monthly payments than a conventional mortgage. This can be especially interesting for first-time homebuyers who are trying to reduce monthly costs while living in their new home.

2. Term: It’s important to note that an interest-only mortgage is not a permanent solution. After the initial interest-only period, you will also need to start making principal payments. This means your monthly payments will increase significantly, so it’s important to be prepared for this.

3. Higher Interest Rates: Interest-only mortgages generally have higher interest rates than conventional mortgages because they represent a higher level of risk for the borrower. This means that over the life of the loan, you will pay more interest than a regular mortgage.

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4. Opportunity to Build Equity: Despite the risks associated with interest-only mortgages, they have the potential to help you build equity in your home faster than a traditional mortgage. Because during the interest-only period, all of your payments go toward interest, which means your principal balance stays the same. However, if your home’s value increases during this time, you may be able to benefit from the appreciation when you sell the property.

5. It’s not for everyone: Overall, an interest-only mortgage isn’t the right choice for everyone. If you are considering this type of mortgage, quality and weight are important

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