(InvestigateTV) — Uncertainty in the real estate market and high mortgage rates are making homebuying a challenge for many Americans.
Bank of America’s latest survey found 60 percent of potential and current homebuyers are unsure whether now is the right time to buy. But more than half – 52 percent – said conditions are better than they were a year ago.
Matt Vernon, head of consumer lending for Bank of America, said mortgage rates have been sitting around 6 to 7 percent for nearly a year and people are getting used to the fact that that’s the new normal when borrowing money for a home.
“And I think folks that own an existing home that would want to buy, that may be carrying a lower rate today, are getting used to the fact that they’re going to potentially pay a higher rate for that next home,” Vernon noted. “And perspective new home buyers also have to understand now that they have to budget for a rate that now sits at this new normal, this trading range of 6 to 7 percent.”
Vernon said more buyers are taking proactive steps – building up savings for down payments, improving credit scores, and talking to loan specialists to get pre-approved.
“And you need a real estate professional in that local market that understands how to prepare a borrower, whether they’re new or existing, to be ready to act when they’re ready to act and that’s different, certainly in the northeast,” he shared. “Today you need to be ready to get in on the day of. In some parts of the southeast now, where there’s more inventory, it’s not as urgent, but still a local professional is really important in this process.”
Beyond the mortgage payment, Vernon advised buyers to plan for property taxes, insurance, and unexpected repair costs by setting aside an emergency fund.
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