‘It’s scary’: Central Texas realtor alarmed as home mortgage rates increase to levels not seen since early 2000s

Published: Oct. 27, 2022 at 5:48 PM CDT
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WACO, Texas (KWTX) - Home mortgage rates in the country are hitting record breaking numbers this week AND realtors say it’s scary that 30-year mortgage rates are now over seven percent.

Reports show that rates last week went from 6.94 percent to 7.08 percent, a rate not seen since 2002.

“It’s scary, especially, for home buyers, especially, for first time home buyers because they’ve been so used to these low two-three percent interest rates over the last five years,” said local realtor Dawn Chadwell.

Chadwell said in a steady market, rates usually fluctuate by half a percentage point to a point point. “It kind of surprises me that it’s gone up so fast, because four points interest rise in less than a year is kind of scary.”

Chadwell said the Federal Reserve increased rates to control inflation.

“The Federal Reserve is trying to slow down the market, kind of slow down people from spending so much money so they stop that inflation. So, what they do is raise the interest rates and make it a little bit more difficult for us normal people to use our credit cards, buy a house, to slow down that purchasing. Because when we have all this money in the market it keeps just driving the inflation rate up,” said Chadwell.

Mario Gonzalez, a real estate agent with Coldwell Bankers Apex Realtors of Waco, said buyers were getting beat out purchasing homes because rates were low, now it’s the opposite.

“Now fast forward a year later, or even six months later, at this point rates have gone up more than double. Their payments have gone up three, four, five hundred dollars. It’s truly affecting their debt-to-income ratios, because of that it’s affecting their possibility of even buying,” said Gonzalez.

Chadwell advises folks to get a realtor who has been in the business for more than a few years.

“There’s a lot of realtors that got into the market when the rates were in the last year, in the last year and a half. So, they don’t know exactly what’s going on so that can cost a home buyer a lot of money,” said Chadwell.

Chadwell believes that it’s still a decent time to buy a house.

She said the priority should be having a lower interest rate even if a home’s prices are a little higher.