Mortgage Rates Are Back Above 7%. What Should You Watch in the Fall Housing Market?

On September 24, Freddie Mac reported that the average 30-year fixed mortgage rate rose to 7.03%, up from 6.95% the previous week.

For buyers, a change in mortgage rates is more than just a number. For example, on a $400,000 loan over 30 years, the principal and interest payment would be approximately $2,398 at 6% and $2,669 at 7.03%—a difference of about $271 per month, or roughly $3,250 per year. This does not include property taxes, homeowners insurance, or HOA fees.

That doesn’t mean buyers should automatically stop looking. Instead, it’s important to look beyond the headline rate and understand the actual loan terms you may qualify for and the total monthly housing cost you can comfortably afford. If you find a home you like, you can also consider whether seller concessions or closing-cost assistance may be available.

For sellers, the message is just as important. When mortgage rates rise, buyers face higher monthly payments for the same home. Rather than focusing only on what nearby homes sold for in the past, sellers should consider current competition and today’s buyer purchasing power when setting a price and developing a sales strategy.

Mortgage rates and the housing market are difficult to predict. What buyers and sellers can evaluate is their own monthly budget and how competitive a property is in the current market.

If you’re considering buying or selling in the Chicago suburbs, I can help you look at current listings, recent sales, and local market conditions to develop a strategy that fits your situation.

Sang Han | Chicago Realtor