buying a home in 2023

Higher Mortgage Rates Aren’t So Scary Anymore—Why Buyers are Adapting

12 Jun, 2023

For much of 2020 and 2021, the housing industry saw record low mortgage rates. Some buyers were locking in rates at under 3% for 30-year fixed mortgages! So, when rates jumped up to over 7% in 2022, many buyers pressed the brakes. But now that rates have remained between 6%-7% for an extended period, buyers are adapting to the new norm.

According to, “Steady rates are instilling more confidence in home buyers who are turning to new construction for greater inventory options. Home builders also report feeling more optimistic about the outlook for new-home sales and resuming more single-family construction.”

The interest rate influence

With the current interest rates staying relatively consistent at around 6.5%, buyers are starting to change their strategies in order to purchase a home. In fact, with the help of great agents and lenders, many buyers are able to make a move now. Not only that, but economists are also predicting the rates to lower closer to the 6% mark as the second half of the year unwinds.

According to Nadia Evangelou, senior economist and director or real estate research for the National Association of REALTORS® says, “With inflation easing further and the Federal Reserve expected to pause its rate hikes soon, mortgage rates will stabilize near 6% in the second half of the year.”

The bottom-line is, rates that have seemed scary six months ago are starting to hold less power amongst eager buyers. And this mentality should only get better over the next six months.

Mortgage rates over the years

To better adapt to the current interest rate atmosphere, it can help to take a look at the past. Freddie Mac began tracking 30-year fixed-rate mortgage rates in April 1971. Here is a breakdown over the decades:

Mortgage Rates Decade Beginning Rate Decade Ending Rate
1970s 7.31% 7.48%
1980s 7.48% 9.78%
1990s 10.13% 8.06%
2000s 8.06% 5.14%
2010s 5.14% 3.72%
2020s 3.72% TBD


As you can see, there has been a lot of fluctuation in mortgage rates over the last six decades. And obviously, different economic and political climates influenced each decade greatly, but the report is a good way to see how rates change over time. And in the end, the housing market always finds a balance, and buyers adapt.

Adapting and moving forward

As real estate professionals now is the time to inform and encourage your clients to move forward with their home buying needs. With home prices dropping slightly, and less demand for each property, it can be a great time to find a new home. In fact, Nadia Evangelou also states, “With a 6.4% mortgage rate, the typical home buyer can afford to purchase a home up to $380,000—just 2% less than the national median home price—if the buyer puts 20% down. About 45% of listings fall within this price range.”

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