Questa del Rio News is starting a regular column discussing the real estate market from a Taos County perspective. Brittany Maes is a real estate agent with Berkshire Hathaway Homeservices and Taos Real Estate. This is not a paid or compensated advertisement.
Have you watched the news lately? Well if you haven’t, I am sure you have scrolled through TikTok or Instagram and seen the buzz, reporting that mortgage interest rates are high these days.
Interest rates are higher than they’ve been in quite a while. From January 2022 to November 2023, the average rate for a 15-year fixed-rate mortgage jumped from around 2.3 percent all the way to over 7 percent. And even though the average rate dropped to under 6 percent during January 2024, that’s still nearly 4 percent higher than the lowest rates we saw back in 2021. Which I get—trust me, I do. I am never here to convince anyone to buy or sell, ultimately I’m here to guide you in the process. I am here to offer you perspective and knowledge on how the housing market is trending in Taos County and northern New Mexico.
Lots of folks haven’t been able to afford to buy real estate because of high interest rates, so they’ve been patiently waiting, scrolling through Realtor.com and Zillow. As rates have lowered, more people have started to buy homes and more sellers have been able to raise their prices because of that increase in demand. In other words, the prices of homes are remaining high yet somehow still sell. That kind of market is best known as a sellers market.
The one thing I see for buying now as an incentive while interest rates are high, is that you can always refinance down the road. Some mortgage companies offer little to no cost to refinance, while other mortgage companies offer forgivable down payment assistance. On the other hand, if you wait to buy and home prices go up, you’re likely stuck with the higher prices.
As your local realtor and family friend I am always willing to speak with local Norteños about your options and if purchasing is the right choice for you. As a golden rule, you should only buy a house if you’re prepared financially. How do you know if you’re financially ready to buy a house? Let’s break it down.
First thing to ask yourself is are you emotionally ready? Even if it’s just going to be your “starter” home, you’re making a huge financial and life-altering decision and putting some roots down. You’ll want to think about your other life goals for the next few years. Will you be buying with a partner? If yes, are you both on the same page when it comes to money? Is there any chance you’d need to relocate in the near future? Are you thinking of starting a family? These big-picture questions can add to the pros or cons of whether this is the right time to buy.
The next thing to ensure is that you have a strong credit score. Getting your credit score in check will increase the likelihood of obtaining a lower mortgage interest rate. Know the mortgage options for your credit score. If your credit score could use some work, it may be worth holding off on buying and seeing what you can do to build up your credit score back up. One way to do this is through regular on-time payments or keeping your credit utilization under 30 percent.
Once you’ve determined what you can afford, some things to keep in mind before taking the leap should include:
- Total closing costs
- Fees that might be rolled into the loan amount
- Down payment
- Earnest money deposit
- Seller credits
Buying real estate is such a big decision that it should be handled with the utmost consideration and care. Finding a local real estate agent you can trust is a big step in the right direction. Feel free to reach out to me via email at buydirtNM@gmail.com with any questions about the market and your considerations in purchasing a home.
