VA Loans Blog

Please, Don't Hold Your Breath

June 5th, 2022 11:43 AM by Joan Rusco

Rarely will we at VALoansMN urge readers to rush a decision. That is certainly true today. 

The VA loan market is also changing. One year ago we were offering rates below 3%. Currently rates are running in the 5% range. Will they come down? Given the state of the economy we aren’t holding our breath. Still, even with mortgage rates 2+% higher than a year ago borrowing is still cheap. How can that be?

The most optimistic view of the economy puts the rate of inflation at well over 8%. Don’t you wish the price at the pump had only gone up 8% this year? It’s much more likely the cost of goods and services you consume is up much more than the Consumer Price Index showing inflation in the 8.5% range. This is why we at VALoansMN can say VA loans are still very cost effective. Whenever you can borrow at a rate below the rate of inflation you’re winning the money game. Sitting on the sidelines waiting for VA loan rates or house prices to decline is not a winning strategy. Actually if you’re sitting on the sidelines waiting for what you might consider improving conditions there’s no way to win. You’re not even in the game.

The real estate market is also changing. There are many more houses on the market today than at this time last year. We’re seeing an increase in supply and with that is coming increased demand. Therefore, generally speaking, home prices are not declining. Data shows only that the increase in home prices has slowed somewhat but they are still increasing. We discussed this situation in our previous post.

To summarize our thoughts on mortgage rates and housing costs, both have, and continue, to increase. At VALoansMN we are ready to offer you options which might get you back in the game as a winner. Call Brad (612-240-9922) to get a clearer picture of your own place in this changing economy. We want you to WIN!


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