Buyers are still out shopping for homes, which suggests they think [the recession] is a temporary blip. Generally, when we’ve seen unemployment rise, it tends to slow down home purchases. But that’s not what we’ve seen this time, although we did see home sales drop as people were stuck at home.

–® Chief Economist Danielle Hale

The hot summer temps & firework displays aren’t the only thing heating up this July…

After a rough spring, the economy is looking up, as nearly 5 million Americans went back to work in June. That’s likely to cause another ‘bang’ to an already hot housing market.

The economic turbulence has led to record-low mortgage interest rates, spurring some skittish buyers worried about the economy into the home-buying market. Those ultralow rates, which can potentially shave more than a hundred dollars off a monthly mortgage payment and tens of thousands of dollars over the life a loan, may help to explain why mortgage applications to purchase a home surged. They shot up 18.1% annually in the week ending June 19, according to the Mortgage Bankers Association. That means there were nearly one-fifth more folks looking to buy a home in mid-June than there were during the same week last year, before the pandemic and recession.

Summer is usually the busiest time of the year, when prices typically rise the most, as families want to move before their children start school (if that happens in person this fall). Add in all of the folks whose spring home searches were stymied by the pandemic and are now back to scouring listings and attending showings, and the housing market is on fire.



Loan Amt: $250,000

Interest Rate: 8.86%
Term: 30 Years
Payment: $1,986


Loan Amt: $250,000

Interest Rate: 12.7%
Term: 30 Years
Payment: $2,707


Loan Amt: $250,000

Interest Rate: 8.12%
Term: 30 Years
Payment: $1,855


Loan Amt: $250,000

Interest Rate: 6.29%
Term: 30 Years
Payment: $1,546


Loan Amt: $250,000

Interest Rate: 4.87%
Term: 30 Years
Payment: $1,322

When shopping for a mortgage, rates matter hugely. That’s because mortgage rates affect more than just the interest you’ll pay over the life of your loan. Your fixed rate also plays a major role in determining your “home buying power” — meaning how much home you can afford. Mortgage rates are hovering at historic lows over the past few months. That means many prospective homebuyers can likely afford a more expensive home than they previously thought.


Loan Amt: $250,000
Interest Rate: 3.13%
Term: 30 Years
Payment: $1,072

July rates are at about 3.13% for a 30-year, fixed-rate mortgage. At that rate, it would be possible to afford a home valued at more than $350,000 and pay only about $1,500 per month (not including taxes, insurance fees). A year ago, when rates were over 4.6%, the same monthly payment might have gotten you a home priced less than $300,000.

In fact, just a 0.125% change in mortgage rates can change your home-buying.

Early on in a typical 30-year mortgage, more than 95% of a buyer’s monthly payment goes toward interest. The lower the mortgage rate, the lower the amount of interest that needs to be paid. And the lower the monthly payment, the more affordable the home is on a month-to-month basis. Put another way, if you can afford a certain monthly payment based on your income, you can afford to take out a larger mortgage if interest rates are lower.

Will mortgage rates drop again soon? Should you wait for rates to drop even lower, which would increase your purchasing power? Or should you lock in now and purchase sooner? There is a very small chance of any meaningful decline in mortgage rates to come. That’s because the bond market has already priced in another Fed rate cut by the year’s end, and with current mortgage rates hitting historical lows, it’s a favorable time to GO FOR IT!


Whether you’re a first-time buyer or you’ve done it all before, purchasing a home can be a complicated and stressful experience. It’s no wonder that over 90% buyers choose to be represented by a Realtor®.

REALTORS® aren’t just agents. They’re professional members of the National Association of REALTORS® and subscribe to its strict code of ethics. The REALTOR® difference provides home buyers:

  • An expert guide. Buying a home usually requires dozens of forms, reports, disclosures, and other technical documents. A knowledgeable expert will help you prepare the best deal, and avoid delays or costly mistakes. Also, there’s a lot of jargon involved, so you want to work with a professional who can speak the language.
  • Objective information and opinions. REALTORS® can provide local information on utilities, zoning, schools, and more. They also have objective information about each property. REALTORS® can use that data to help you determine if the property has what you need.
  • Negotiation knowledge. There are many factors up for discussion in a deal. A REALTOR® will look at every angle from your perspective, including crafting a purchase agreement that allows you the flexibility you need to take that next step.
  • Up-to-date experience. Most people buy and sell only a few homes in a lifetime, usually with quite a few years in between each sale. Even if you’ve done it before, laws and regulations change. REALTORS® handle hundreds of transactions over the course of their career.
  • Your rock during emotional moments. A home is so much more than four walls and a roof. And for most people, property represents the biggest purchase they’ll ever make. Having a concerned, but objective, third party helps you stay focused on the issues most important to you.
  • Ethical treatment. Every REALTOR® must adhere to a strict code of ethics, which is based on professionalism and protection of the public. As a REALTOR®’s client, you can expect honest and ethical treatment in all transaction-related matters.