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By Kevin Parker - Vice President, Mortgage Lending: Sept. 19, 2022

Lately, we’ve been getting lots of questions from our members about the housing market. From mortgage rates to housing inventory and prices, they mainly want to know: “Is This a Good Time to Buy a House?”

That’s a great question, and just like everyone has a different definition of their “dream home,” there’s no one-size-fits-all answer. Let me tell you about some of the latest trends we’re seeing that might help shed a little light on today’s housing market.

Interest Rates

It’s no secret that mortgage rates have risen this year. We’re no longer seeing the historic lows that stuck around for quite some time and were prolonged during the pandemic. Industry rates on 30-year-fixed mortgages are now hovering at about 5.5% and seem to be settling there. I realize that might seem high, especially because we saw those historic lows for quite awhile.

However, if you put today’s rates in context with how the average rate has trended over the last few decades, mortgage rates are still relatively low.

Rate Trends

According to Freddie Mac, the long-term average rate for a 30-year mortgage is just under 8%, higher than today’s 5.5% average. And at one point during the 1980s, rates soared to as high as 18%!

Take a look at this chart that tracks 30-year mortgage rates all the way back to 1971. All in all, in context, today’s rates still fall below the historical average.

Housing Inventory and Competition

If you’ve been in the market for a new home recently, you’ll know that housing inventory has been low during the last few years, and that’s caused prices to climb rapidly. Competition among buyers has been fierce, with bidding wars and buyers offering way over the asking price in order to secure a home.

But we’re starting to see this trend slow down – and that’s good news for buyers. Inventory is edging up slightly* and competition among buyers has been trending down.* Buyers are likely to see fewer bidding wars when they make an offer on a home, depending on where the property is located.

Is the Time Right?

But back to our original question: Is It a Good Time to Buy a Home? To help decide, take a look at your budget and run some numbers to see what your monthly mortgage payment could be. We have some interactive mortgage calculators on our website that can be a great help.

If you decide you can afford a house right now, that’s great. Mortgage rates are below the historic annual average and housing prices are starting to stabilize.
But, if after running the numbers you’re still questioning whether you can afford to buy right now, it might be a good idea to wait. You can take some time to save more money and enter the housing market later, when you’re in a better position. Ultimately, only you can decide if it’s the right time for you to make a move.

Author Bio: Kevin Parker (NMLS#: 1058093) is Vice President of Real Estate Lending at Navy Federal Credit Union. He has been in the mortgage industry for 24 years. He took out his first mortgage in 2005 at 6.5% APR.


This content is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.