We're fully into the spring homebuying season, but some prospective buyers are hesitant to get into the market. Why? Interest rates.
A survey from U.S. News and World Report finds that 66% of Americans who plan to buy a home this year are waiting until rates fall.
"The problem is once mortgage rates do start falling, that demand's going to pick right back up," says Erika Giovanetti from US News and World Report.
So what's a better option?
"You know the old saying, 'marry the house, date the rate,'" Giovanetti says.
Additionally, 25% of homebuyers holding out for lower rates are waiting until they drop below 5%.
"I've got some bad news for them, the 30-year fixed rate isn't expected to fall below 5-percent this year," Giovanetti says. "You'll want to focus on things within your control."
So, homebuyers are getting creative. According to the survey, 62% of respondents say they've had to reduce their home price budget due to the current rate environment.
“Mortgage rates are about twice as high now as they were a little over a year ago, which has exacerbated housing affordability challenges ahead of the spring 2023 homebuying season,” Giovanetti says. “Today’s homebuyers are extremely sensitive to fluctuating interest rates, and a significant drop in mortgage rates would likely make the market more competitive.”
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