Interest rates have risen recently. Prospective buyers shouldn’t be alarmed, according to Mortgage Solutions loan officer Mike Romero.
“We were fortunate to see interest rates below three percent, the lowest in history,” Romero said. “The Fed was buying this on purpose with its monetary policies and lowering the federal funding rate to zero. Now, with lots of stimulus and people not working, we have inflation. There are too many dollars for too few goods…goods that weren’t made by workers who weren’t employed. When you add the price of oil, the war in Ukraine and supply chain issues, interest rates jumped almost 2% in a matter of months.
Romero noted that for many people, this news sounds alarming. However, he pointed out that in reality, an interest rate of 5% or 6% is a decent way to finance a house. The historical average of interest rates in the United States is 8%.
“Don’t worry,” Romero said of rising interest rates. “Homes will continue to appreciate and remain a good investment.”
Romero, an MBA, moved to northern Colorado in 2020 and joined the Mortgage Solutions team.
“It’s great,” he commented. “It’s a place where I can really use my degree. The most important thing is to pay attention to the economy. The team are amazing and have a wealth of knowledge.
Mortgage Solutions Financial helps clients obtain home loans, construction loans and home equity lines of credit.
“It’s a pleasure for me to help people get to where they want to be,” added Romero. “It’s exciting to watch the first-time home buyer work on their credit, their budget to start saving and buy the biggest asset they can have. It’s also nice to help people with their financial literacy Many homeowners we work with are learning how to use the equity in their property to pay down debt and save money.”
Overall, demand is still high and the supply of homes remains limited in Estes Park. Romero said older generations, like baby boomers, are living longer and staying at home. An increase in investor activity is also eating away at available housing. Many millennials are reaching home buying age and have families in their 30s. They are ready to buy.