So...if I was thinking about looking at homes in the spring, it is sounding more and more like a rate increase will be occurring this month..some economists are predicting a steady, incremental series of increases. The Federal Reserve Board apparently believes that the jobless rate has improved significantly enough to begin raising rates. The fact that most of these jobs are in retail this time of year, and that wage increases sit at at dismal 2% are being dimissed .However, Yellen made clear that wage growth isn't a requirement to raise interest rates. Wages are usually the last measure of the economy's health to move in the right direction.
"We may not see wage growth pick up," Yellen said. "I wouldn't say that is a precondition to raising rates."
If homeownership is on your horizon and you believe it will be a squeeze, things will most likely be getting even tighter. Home prices are rising in just about all markets and with higher interest rates factoring into your monthly payment, it may be time to take a big gulp, talk to a lender and ask them to run you scenarios with your current income, current interest rate..and then what will happen to your ability to qualify if and when the rate goes up..
We are lucky to have the USDA program in most of the counties around here (Chisago, Isanti, Kanabec and Pine)..0 down helps many get their foot in the door.