As the new presidential administration gets settled into the White House, there are many questions that pertain to any number of financial related issues – including whether or not interest rates will go up in the near future.
While higher interest rates can have an effect on investors’ portfolios, they can also make the home buying process a bit more difficult for anyone who needs to secure a mortgage – particularly if you are trying to keep your monthly payment at or below a certain dollar figure.
With the raising of the benchmark interest rate by a quarter of a percentage point back in mid-December, there is still some talk that President Trump will increase rates even further. However, while this is a possibility, it could be a few years before it happens.
One of the biggest reasons for this is because the central bank will likely seek to prevent too much inflation at one time, as this could do more harm than good. This is particularly the case as the U.S. economy is perceived to be running at or near its full potential.
In addition, over time, the pattern with many other new administrations has been to lean more towards keeping interest rates low, as doing so can typically help with preventing too much inflation – at least in the shorter term.
That being said, now could be the perfect time to buy that new home that you’ve been dreaming of, and locking in a long-term lower mortgage rate that will keep your payments steady, regardless of what happens with rates in the future.
If you’re considering selling and / or purchasing a home in the Bakersfield area, Contact Us. We can work with you in finding the ideal location and style based on your needs, while at the same time staying within your budget. We can also provide you with an analysis of the value of your current home in order to give you an idea of a possible listing price.