Lately, a lot of buyers have been hitting pause, waiting (and hoping) for mortgage rates to drop back to the 3% range we saw a few years ago. But here’s the reality: those ultra-low rates were part of a unique moment in time, not the new normal.
Let’s rewind for a second…
Back in 2020 and 2021, we were in the middle of a global pandemic. The economy needed a jolt, and record-low interest rates were part of that emergency response. Buyers at the time got a big boost in affordability and buying power, but those conditions weren’t built to last.
Fast forward to today, and the market has shifted. Mortgage rates are sitting in the high 6% to low 7% range, and while a small dip may be on the horizon, most experts agree: we’re not heading back to 3%.
According to Kara Ng, Senior Economist at Zillow:
“While Zillow expects mortgage rates to end the year near mid-6%, barring any unforeseen shocks, that path might be bumpy.”
So what does this mean for buyers?
If you’re holding out for 3% rates again, you could be sitting on the sidelines for longer than expected, and potentially missing opportunities in the meantime. Instead of waiting for the “perfect” rate, focus on what you can control:
- Your budget and financial prep
- Improving your credit score
- Partnering with a trusted lender and local agent (hi, that’s us!)
A solid team will help you uncover current financing options, down payment programs, and creative strategies that work in today’s environment, not yesterday’s.
A Competitive Edge
Here’s the other thing: if rates do ease a little later this year, that might invite more buyers back into the game, creating more competition. Getting prepped and pre-approved now could give you a leg up before that rush.
As Realtor.com puts it:
“Staying out of the market in hopes of a rate drop that never comes can lead to missed opportunities… Rising home prices, rent increases, and inflation might outpace any future savings on interest.”
Final Takeaway
The 3% rates everyone remembers were an exception, not the rule.
With the market finding a new balance, this is the time to stay informed, adjust your expectations, and make empowered moves. Whether you’re ready now or just planning ahead, our team at Real Estate Exchange, and a great local lender, can help you make sense of your options and build a plan that fits.
Ready to talk it out? Reach out anytime, we’re here to help you take the next step with confidence.
