From a home buyer’s perspective, 2016 hasn't exactly been the best time to look for a new home, especially towards the end of the year when mortgage rates spiked and inventory continued to dwindle. In addition, the strong demand for housing in places like St. Paul and the rest of the Twin Cities region also kept home prices on the rise for most of 2016 as well, sometimes pricing young and first-time home buyers out of the market.
If you’re looking for a little relief heading into the new year, you might be disappointed to learn that most projections have mortgage rates and home prices continuing their upward trend, likely posing more of the same challenges home buyers faced in 2016.
Even with rates climbing, however, it’s still worth noting that they’re still near historically low levels, at least for the time being. Most economists have mortgage rates reaching somewhere close to 4.5% in 2017, or even slightly higher, but nothing past the 5% mark. And the good news for most home buyers currently in the market for a new place to live is that if you’re not able to secure a home loan at 4%, chances are you won’t be able to secure one at 4.5% either, which of course really doesn’t impact affordability.
But the best advice for anyone looking to buy in 2017 is to act quickly, because the longer you wait, the more interest you’ll likely have to pay.