The volatile end to 2018 on Wall Street that saw the worst December since the Great Depression for the stock market came with a silver lining---cheaper mortgage rates. Just weeks after higher interest rates were blamed for a slowdown in the market, things have changed. "We currently do have a dip of about a half-percent since November," says Chris Nooney, certified mortgage planner with Goldwater Bank. Indeed, the current average 30-year fixed rate is at 4.84 percent, while the average 15-year fixed rate is 4.25 percent.
The lower mortgage rates combined with other factors make this a buyer's market in Houston, according to Nooney. "When you go into the end of one year and the beginning of a new year, inventory tends to decrease which really turns it into a buyer's market, because homes don't sell as quickly," he says. Nevertheless, the cheaper borrowing opportunity may be short-lived. "As the Dow continues to increase and we continue to see the economy expand (in the coming year), we will continue to see an increase in mortgage rates," says Nooney.
While cheaper interest rates can save home buyers money in the long run, Nooney cautions it is hardly the only factor for buyers to consider. "On a $200,000 home, a quarter of a percent in rate represents about a 50 to 60-dollar difference in payment, so it's not a significant difference," he says. "So if you're on the fence, now is a good time to get off the fence and look at existing inventory."