While current interest rates are some of the lowest in modern history, they will soon start to rise. Usually, consumers and investors hear that interest rates will rise and immediately assume this will be a a costly problem. However, according to economists, these rates will not climb quickly enough to cause long-term damage. Climbing interest rates are also a sign of a healthy economy, signifying that people are spending, companies are hiring, and rates are rising at a normal rate. US as well as European rates in financial markets are on the rise, and economists believe it will continue to do so. The US economy is expected to expand 2.5 percent this year, very close to last year’s expansion of 2.4 percent. However, the buzzing job market will make a difference. In the last year, 3.1 million more people became employed, bringing the unemployment rate down from 6.3 to 5.5 percent.
What do these economic changes and rising interest rates mean for consumers and home-buyers? Mortgage rates will continue to climb. Fixed-rate mortgages are advisable due to this continuous climb expected in mortgage rates.
With an economy that is growing, higher interest rates are inevitable and a good sign of a healthy economy. Also, these rates are not spiking- they are rising more slowly than people expect and will not have extreme affects. In today’s sturdy economy, it is a great time to invest in a home in the Miami Area, and RE/MAX Paradise agents are available to help you do so today!