Should I Buy with Mortgage Rates Increasing?

It is no surprise that mortgage rates have continued to increase over the last few months. From 2018 until 2021 we saw the average mortgage rates drop from 4.54% down to the record low of 2.96%. Buyers took advantage of these rates and real estate inventory quickly became depleted. In May of 2022 however, current mortgage rates sit around 5.11%. Now that mortgage rates are rising again, many buyers fear that now is not the right time to buy, are they right?

For every individual the answer to this question may vary, but ultimately if you are financially ready to purchase a home than it is still worth it. The increase in real estate prices has led to an increase in home equity.  “Home buyers who purchase a home today are still likely to see rising property values and increased home equity. That’s because supply is still relatively low compared to buyer demand, so home prices are likely to keep rising, although at a slower pace,” notes National Association of Realtors (NAR) senior economist Gay Cororaton. The increase in your home’s equity can add to your net worth as well as give you a low-cost source of money when it comes time for you to sell.

Another important thing to note is that rent prices have also been increasing over the last 5 years. The average 3-bedroom home in the Joplin area has increased by almost 400 dollars a month in just the last 5 years. A fixed-rate mortgage will provide a fixed housing cost and monthly payment that cannot be guaranteed with renting. To add on top of that, with rents increasing year over year, the equity that can be gained of homeownership provides a return that you cannot get with renting from somebody else.

With either decision you feel is best for you, the Ferguson Team can help fit your needs and assist you in the process. Our 5 licensed agents are committed to helping you find the best home for you. They take pride in making the homebuying process as stress free as they can to get you and your loved ones where you want to be. Our property management team is also here to help you find a rental property in Joplin and the surrounding neighborhoods. We can help you find a rental property that fits your needs. The Ferguson Team is excited to become your real estate partners! 

809 Katherine Ave 
Joplin, MO 64801
M-F 8:30am-5:30pm
Office: 417-553-9914
Broker: 417-623-9900 (Ask for the Ferguson Team!)