Rapidly rising mortgage rates will shift the real estate market here in the Alexandria area, according to local real estate agents and home lending professionals.
Right now, mortgage rates are they highest they’ve been since 2011, said Christian Hartung, senior vice president of mortgage lending at Rate.com in Alexandria.
Less than a year ago, well-qualified people could get mortgages as low as about 3%. “They are expected it hit 6% range in the next one to three months,” Hartung said.
That increase in mortgage rates can significantly affects a person’s housing budget. With a loan of $400,000, for example, a 3.125% fixed-rate 30-year loan would cost $1,714 per month. This month, the same loan at 5.125% will cost $2,178 per month — a difference of more than $450.
“It is having some impact on affordability with those buyers that are trying to max out their buying power,” Hartung said. “With others, it’s very doable and still a great time to buy.”
“These are somewhat extreme circumstances which will require both buyers and sellers to make certain concessions,” said McEnearney Realtor Janet Caterson Price.
For home owners considering selling their home this spring or summer, there’s good news: It’s still a seller’s market here in Alexandria. Home inventory remains low, meaning there are few homes on the market for buyers to choose from. Many homes are still receiving multiple offers from interested buyers.