Although interest rates are still historically low overall, the buzz of rising interest rates has been a hot topic for many homebuyers looking to purchase in the upcoming months. Why are interest rates rising? Because interest rates and inflation go hand in hand. Last week, the country saw the largest one month increase in Consumer Prices since 1981. As the economy slowly reopens with more Americans being vaccinated and less restriction for businesses to operate under, the economic demand is much stronger than supply. Which better explains the spike in interest rates we recently saw. 

Mortgage rates are closely tied to the health of the U.S. economy. The county as a whole is on an upswing, which leads experts to believe we’ll see higher interest rates in June and throughout the summer months. However, overall recovery has been uneven. Inflation is ascending rapidly, while the unemployment rate is moving much slower. According to The Mortgage Reports, experts say we’ll continue to see a rise in interest rates going forward into the summer. Here is a previous blog on interest rates and the Tacoma Real Estate market compared from 2019 to 2020. How is 2021 shaping up? We’ll keep you posted.

Here is a chart that shows the week of May 17, 2021 vs. May 10, 2021 and how the slight increase in interest rates could affect your monthly payment:

Based on a loan amount of $350,000 and minimum credit score of 740:

Information provided by Guild Mortgage Company.

 Are you curious how an increase in interest rates could effect your future purchase amount? CALL/TEXT Realtor Jenny Wetzel 253-381-9788 or email Jenny@JennyWetzelHomes.com.