Lake Charles, LA (KPLC) – An increase in interest rates may be deterring buyers from becoming homeowners or moving in to a new home.
There’s a lot to think about when purchasing a home and real estate agent Danette McManus said it can become very overwhelming for buyers.
“We can’t always depict exactly what’s going to happen, but we will tell you that the interest rates as we all know have increased,” McManus said.
The current mortgage rate for a home in Lake Charles is 6.472% for a 30-year fixed rate, according to Nerdwallet.
“I mean just in our five parish area we still have plenty of inventory, but you’re not dealing with as many repairs needed,” McManus said. “Those things have kind of been wrapping up, but at this juncture where do these people go? We can go sell your house, but where are you going to move?”
So, what’s it going to take to go from ‘For Sale’ to ‘Sold’? Well, McManus said interest rates aren’t the only thing weighing on buyers in the market right now.
“We have the increased interest rates then we have the insurance crisis going on,” she said.
McManus explained over 20 insurance companies have pulled out of the state.
“That requires the owner to then go to a secondary policy and usually its citizens. Which is usually meant for last resort,” McManus said.
With the influx of people needing coverage, insurance rates are high all across the state of Louisiana.
“In our costal parishes, insurance has gone up 111% across the board. That is a massive increase,” McManus said.
It’s an added cost factoring into buying a home.
“The price [of the home], the property taxes, the homeowners insurance, the flood policy, all of those things make a big puzzle piece fit together and if those aren’t jiving then we can have a lot of let down buyers,” McManus said.
She explained in terms of affordability, there are options you may be able to work through with your home lender including grants and programs to bring down interest rates.
“As a buyer, do your due diligence, get with a real estate agent,” McManus said. “Use their resources and put money aside. That is not going to hurt anything to have extra money in your pocket to have for a down payment.”
McManus also warned about doing any research online, as it may not be indicative to our area. She said it’s best to reach out to experts who can guide you through the tricky process of buying a home.
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Source: kplctv.com