After the Federal Reserve cut interest rates last month, many thought mortgage rates would drop.
Mortgage rates have climbed to 6.85%, the highest since late July.
For people like 100-year-old World War II veteran Harry Long, these rising rates made it impossible for him and his wife to buy again after Hurricane Ian.
Long and his 98-year-old wife now rent. Real estate broker Dirk Fischer said they’re far from alone.
“We had about 35% fewer sales compared to a year ago. It’s really going down while inventory is spiking, but who’s going to be motivated to buy right now, especially if they can’t pay cash?” Fischer said.
Mortgage rates have doubled compared to a few years ago.
“Everyone was hoping that by now, mortgage rates would be in the low fives or lower after the last Fed rate announcement, but instead, we’ve seen another jump, and now we’re almost back to where we were in December 2023,” Fischer said.
However, according to Florida Gulf Coast University real estate professor Shelton Weeks, historically, these rates aren’t all that high.
“If you look back to the ’80s, you saw mortgage rates in the mid-teens. Even in the ’90s, when I moved to Florida Gulf Coast University, I was super excited because I was able to come down here and get a rate under 8%,” Weeks said.
hese experts recommend some tips to navigate higher rates:
- Consider builder rates: Some builders may offer deals with around 4.5% APR.
- Buy down your rate: It costs more upfront but can save money over time.
- Shop around: Ask about special programs for first-time buyers, veterans and first responders.
