Why Home Buyers in the LBI Real Estate Market Should Avoid Waiting for Low Mortgage Interest Rates
- Nathan Colmer
- 14 minutes ago
- 4 min read
Buyers, LBI Real Estate and Mortgage Information
If you are a home buyer watching the LBI real estate market, you might be tempted to wait for mortgage rates to drop to 2% or 3%. It sounds like a smart move: lower rates mean lower monthly payments; however, waiting for these ultra-low rates can actually cost you more in the long run. The reality is that mortgage rates fluctuate, and locking in a rate now could save you thousands. Here’s why holding out for those rare low rates is a risky strategy when buying a home in the LBI real estate market.
By: Nathan Colmer | LBI Real Estate Agent | The Van Dyk Group
Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com
Mortgage Rates Are Unpredictable and Rarely Stay Low
Mortgage rates depend on many factors, including the economy, inflation, and government policies. While rates near 2% or 3% have happened in the past, they are extremely rare and unlikely to return soon. For example, in 2020, rates dropped to historic lows due to the pandemic, but since then, they have steadily increased as the economy recovered.
Waiting for such low rates means betting on a very uncertain future. If rates rise instead, you could end up paying much more for your mortgage than if you had acted earlier. In the LBI real estate market, where prices can be competitive, locking in a reasonable mortgage rate now helps you avoid the risk of higher borrowing costs.
Home Prices in LBI Are Rising and Waiting Could Mean Paying More
The LBI real estate market has seen steady price increases over recent years. Waiting for mortgage rates to drop might mean missing out on current home prices. If prices continue to rise while you wait, any savings from a lower interest rate could be wiped out by a higher purchase price.
For example, if a home costs $1,500,000 today with a 5% mortgage rate, your monthly payment might be higher than a $1,550,000 home with a 4% rate next year. The difference in home price can outweigh the benefit of a slightly lower mortgage rate. This means waiting could cost you more overall.
Locking in a Mortgage Rate Protects You from Future Increases
Mortgage rates can change quickly. If you find a home you love in the LBI real estate market, locking in a mortgage rate protects you from future increases. This gives you peace of mind and helps you budget your monthly payments without surprises.
Many lenders offer rate locks for 30 to 60 days, sometimes longer. This means you can secure today’s rate while you complete the home buying process. Waiting to see if rates drop further means risking losing the home or facing higher rates later.
Inflation and Economic Factors Can Push Rates Higher
Inflation is a key driver of mortgage rates. When inflation rises, lenders demand higher rates to keep up with the cost of money. Currently, inflation remains a concern in the U.S. economy, which puts upward pressure on mortgage rates.
If inflation continues or accelerates, mortgage rates could rise further. Waiting for rates to drop to 2% or 3% ignores this economic reality. Instead, acting now allows you to avoid the impact of inflation-driven rate hikes on your mortgage.
You Can Still Find Competitive Mortgage Options Today
Even though rates are above historic lows, you can still find competitive mortgage options in the LBI real estate market. Many lenders offer a variety of loan programs, including fixed-rate and adjustable-rate mortgages, that can fit your budget.
Working with a knowledgeable mortgage broker or lender can help you find the best rates and terms available now. This approach is more practical than waiting indefinitely for rates that may never return.
How to Make the Most of Current Mortgage Rates
If you decide to buy in the LBI real estate market now, here are some tips to make the most of current mortgage rates:
Improve your credit score to qualify for better rates.
Save for a larger down payment to reduce your loan amount.
Shop around with multiple lenders to compare offers.
Consider different loan types such as FHA or VA loans if you qualify.
Lock in your rate early once you find a home you want.
These steps can help you secure a mortgage that fits your financial situation without waiting for uncertain rate drops.
If you are looking to buy, sell, or invest in the LBI real estate market, contact me, Nathan Colmer, for expert guidance backed by years of local experience, deep market insight, and a proven track record in helping clients navigate LBI's unique market. My experience extends over 20 years of selling homes on Long Beach Island, with a special focus on second homes and investment properties. In addition to representing buyers and sellers, I personally invest in the LBI real estate market and can share my firsthand knowledge of this investment strategy. Whether you are searching for a vacation home, planning a wise investment, or ready to list your property, I can offer you personalized strategies and unmatched knowledge to help you succeed.
By: Nathan Colmer | LBI Real Estate Agent | The Van Dyk Group
Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com
