Increasing mortgage interest rates: what it means for you

Mortgage rates are on the rise for the first time in years, with 15-year rates expected to rise from 3.9 percent last year to 4.4 percent at the end of this year. Here’s what it means for the real estate market.

What it means for sellers
You should expect your house to stay on the market a little longer before selling it. Taking on a mortgage represents a big commitment, and climbing interest rates are forcing some prospective buyers to stop and think a little harder before buying a house. Also, don’t be surprised if you get fewer offers than you were expecting.

What it means for buyers
While rates are higher than they’ve been in several years, they’re still relatively low. However, the trend isn’t likely to change anytime soon. Unless you’re buying the home with cash, opt for a 15-year fixed rate mortgage and avoid variable rate mortgages as they’ll likely go up again in the coming years.

The bottom line is that sellers should manage their expectations, and buyers should keep in mind that rates will likely continue to go up.