DALLAS — The thought of buying a home with high mortgage rates can be daunting.
"We were pretty apprehensive," said Jeffrey Stevens, a new homeowner in Texas. "We closed December 12th."
Stevens and his wife were worried, as rates ranged from 6% to 8% while he was shopping for homes.
"What are the payments going to be?" he wondered. "It's a little bit of a scary proposition."
Stevens got advice from his lenders at All Western Mortgage, and ultimately found a home that fit within his budget even with the current interest rates.
"You date the interest rate, and you marry the home," he was told.
Kevin Pierce, a sales manager at All Western Mortgage, said a lot of his clients have been asking him about a good time to refinance. He's been in the industry for 20 years, and has seen the volatile changes. At one point over a decade ago, he remembers when rates were as high as 18%.
"Now is a great time to go out and buy," Pierce said. "You're still below 10, which is fantastic. You're still in the six, seven, eight percent range. And you'll be able to refinance in the future because it is going to go down at some point in time."
Pierce said a number of factors will influence what happens.
"In 2024, the [Federal Reserve] has promised to stop raising the rates quites as much," he said. "And with inflation hopefully under control for the most part, or put in a situation with elections coming up, it's kind of a perfect mix for the rates to go down."
A one-point drop can be significant for a homeowner. It would lower the payment and bring down the interest rate.
"If the rates go down a point to a point-and-a-half, we're going to be in a position where we'll be able to refinance quite a few people," Pierce said.
Pierce, his team and many of their clients are watching closely to see just how far the mortgage rates will drop in 2024.