“Interest rates are probably the highest they’ve been since 2011,” said Tracy Patrick, Vice President of Mortgage Lending at Amarillo National Bank. “Starting the beginning of September, with the Fed announcing predictions of raising the prime interest rate, we’ve seen a little bit of a steady increase from there.”
Rates on the rise: Amarillo sees increase in interest rates, home prices in housing market
According to Amarillo National Bank’s newest Amarillo economy report, trends show increases in interest rates and median home prices compared to this time one year ago. Some real estate experts say if it grows, it could affect affordability.
“As interest rates keep creeping up a little bit, mortgage rates, and as prices continue to rise slightly, that affordability index is really squeezing down,” said Jim Carr, broker and owner of ERA Courtyard Real Estate. “We’ve got to be really careful and aware of that so we don’t get into a position where folks just can’t afford to purchase.”
The interest rate has increased in the city by one-percent since this time last year. For a home that costs $100,000, that could mean an extra $60 on your monthly payments.
"If you’re looking to buy a home, it may decrease the amount of house you’ll qualify for," said Patrick. "We ran some numbers on a one-percent difference in interest rate on a $100,000 can make about a $60 difference in payment and to people that’s a pretty big hit."
Still, those in real estate say the rates in Amarillo are very good compared to those around the country. With new construction and development in the area, that also means more home availability for buyers.
"We’re seeing more inventory coming on the market now which is good because we’ve been so under balanced for so long that it’s been kind of unhealthy so we’re moving closer toward a balanced market which makes buyers and sellers both very happy at that point," said Carr.
As supply and demand reaches more of a balance and the potential for greater interest rates increases, the experts say now is a good time to make the plunge if you’re thinking of buying a home in Amarillo.