Low mortgage rates in recent years have made it an ideal market for those looking to buy a home, but buyers should beware that rates are rising. According to statements made from Freddie Mac last month, the average rate for a 30-year home loan is now 5.05 percent, almost one percent higher than November when it was its lowest in 40 years. Experts now suggest we have passed the low point in mortgage rates and can expect them to continue to rise in the future.

As you hunt for the perfect home for your family throughout beautiful San Diego county, you are still in luck because rates are historically low. If compared to the rates of a few decades ago, these rates seem nothing to be worried about. 30 years ago, mortgage rates often topped 18 percent, and continued in the double digits throughout the 1980s. That was a time when everyone considered buying a house an undeniably good investment.

Analysts agree that the one good piece of news for buyers in recent years has been the low rates. Suffering from steep drops in home sales, the real estate market would do better if the rates remain low. Even with the low interest rates that have been enjoyed by buyers, home sales hit their lowest in 10 years in 2010. This is because people fear the viability of investing in a house.

Analysts expect that the average interest rate may hit 5.5% by the end of year and then keep going up. The opportunity offered by low rates has been essential because buyers are doubtful of the future value of housing. If rates continue to rise, this may limit the number of people willing to buy instead of choosing the seemingly safer option of renting. But experts suggest that rates may never reach the height they were at in past decades.

This shouldn’t sound like awful news to potential buyers, because in reality the rates are not hiking all that much. Inflation, or expectations of it, are what is really pushing the change. If you’re in the position to afford property – home, condominium, apartment, or luxury home– you may even find less competition in the market as rates go up. The future of the market and the nature of mortgage rates remains to be seen, but you may find that the market offers the perfect opportunity to snag a beautiful new home.

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This is filed under National Markets.

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