How to Buy a Home Without Waiting for Lower Rates

If you’ve been holding off on buying a home, waiting for mortgage rates to drop significantly, you may want to rethink your strategy. While experts do predict rates will decline, they may not fall as much as many buyers are hoping for.

A few months ago, projections suggested that mortgage rates could dip below six percent by the end of the year. However, the latest data from Fannie Mae, the Mortgage Bankers Association, and Wells Fargo now indicate that rates are expected to stabilize closer to six and a half percent by year-end. Thanks to Keeping Current Matters for highlighting this data.

So, if you’ve been waiting for a dramatic drop in rates before purchasing a home, you could be waiting longer than expected. And if you need to move due to a job change, growing family, or relocation, delaying your plans might not be practical.

Homeowners: Is It Time to Sell?

Another factor to consider is the steady rise in home prices. Over the past five years, home prices have surged by 60%, meaning many homeowners are sitting on more equity than they realize. If you’ve been contemplating selling—whether to downsize, upgrade, or relocate—this could be an ideal time to capitalize on your home’s increased value.

Strategies to Make Homeownership More Affordable

If mortgage rates aren’t dropping as much as you’d like, there are still financing options available to make buying a home more affordable. Here are four strategies to consider:

• Mortgage Buydowns: This allows you to pay an upfront fee to temporarily lower your mortgage rate, reducing your initial monthly payments. Right now, 27% of agents report that first-time homebuyers are utilizing buydowns to make homeownership more affordable.

• Adjustable-Rate Mortgages (ARMs): ARMs typically start with a lower interest rate than traditional 30-year fixed loans. If you plan to refinance later or expect rates to drop in the future, this could be a good option. Unlike the riskier ARMs of the early 2000s, today’s ARMs require buyers to qualify at the highest possible rate to ensure they can afford future adjustments.

• Assumable Mortgages: Some buyers can take over a seller’s existing mortgage, including their lower interest rate. With over 11 million homes qualifying for this option, it’s worth exploring if you want to secure a better rate.

• Down Payment Assistance and Grants: Depending on your situation, state or local programs may offer financial assistance for your down payment or closing costs. A knowledgeable lender can help identify and apply for these opportunities.

The best way to determine which financing strategy suits your needs? Talk to Dave Craig, our in-house mortgage lender. Whether you’re considering buydowns, ARMs, or other creative financing options, Dave has the experience to guide you through the process and find the best solution for your situation.

Local Market Update

The local real estate market continues to see strong activity. Here’s a look at the latest numbers:

New Listings

• February 2024

  • Stillwater School District: 98

  • Hudson School District: 32

  • Total: 120

• February 2025

  • Stillwater School District: 96

  • Hudson School District: 54

  • Total: 150

• January 2025

  • Stillwater School District: 76

  • Hudson School District: 30

  • Total: 106

• Change: New listings are up 25% since last year and 41.51% since January.

Home Prices

• February 2024

  • Stillwater School District: $492,643

  • Hudson School District: $443,782

  • Average Price: $468,212.50

• February 2025

  • Stillwater School District: $612,028

  • Hudson School District: $411,809

  • Average Price: $511,918.50

• January 2025

  • Stillwater School District: $550,477

  • Hudson School District: $412,753

  • Average Price: $481,615

• Change: Prices have increased 6.29% since January and are up 9.33% since last year.

Average Days to Sell (February 2025)

• Stillwater School District: 66 days

• Hudson School District: 69 days

• Overall Average: 67.5 days

While mortgage rates may decline slightly, waiting for a significant drop might not be the best strategy. Instead, leveraging options like buydowns, ARMs, assumable mortgages, or down payment assistance could make homeownership more achievable right now.

For homeowners, this market presents an opportunity to sell at a high price and leverage the equity you’ve built. If you’re curious about your home’s value or ready to explore your next move, let’s connect and discuss your options.