CBS News
Should you take out a mortgage loan now or wait until 2025?
Getty Images
For most of 2023 and early 2024, looking for a low mortgage rate was a quest for the impossible. Surging inflation sent rates soaring to their highest level in decades and finding a loan under 7.00% was a fantasy for most would-be buyers.
Fortunately, there has been some improvement in the mortgage market in recent months. In anticipation of the Federal Reserve’s rate cuts in September, mortgage rates dipped, opening up the door to more affordable home loans and even some refinancing opportunities. Rates then fell over a point off their post-pandemic highs, providing hope for would-be buyers.
However, mortgage rates began to rise again in October. While today’s mortgage rates remain below recent highs right now, many borrowers have been left wondering whether they should jump into the market or wait for rates to fall further — especially as the Fed has signaled additional rate cuts are likely through 2025.
Find out how affordable a mortgage loan could be today.
Should you take out a mortgage loan now or wait until 2025?
If you’re on the fence about whether to buy now or delay further, here’s why experts say that waiting may not pay.
There’s no guarantee rates will fall
With the Federal Reserve widely expected to cut rates again in the future, waiting may seem like the obvious course of action. However, there’s no guarantee these anticipated rate cuts will happen — or that they will have the desired effect on the mortgage market since the Fed doesn’t directly control the cost of home loans.
“The challenge with “waiting to buy” is always the same. No one can predict the future, even the greatest financial minds,” says Aaron Gordon, branch manager at Guild Mortgage. “Just look at the last two months. Rates touched an 18-month low in early September. Folks got excited. Pending sales rose to their highest levels all year. Others said ‘they’re still not low enough. I’m going to wait a little longer until they come down more.’ Just weeks later they jumped from the low 6’s to the low 7’s.”
While the Fed followed through with an anticipated rate cut at its November meeting, the recent election could also impact further proposed reductions in the benchmark rate, depending on what policies are enacted in 2025.
With no guarantee that mortgage rates will fall further, Gordon says the best thing to do is to buy “when you’re financially and emotionally ready.”
Compare the top mortgage rates available to you now.
Rate decreases may happen slowly
Delaying your home purchase in anticipation of declining costs could also be a poor strategy because you may have to wait much longer than you’d expect.
“Rates between now and the start of the new year aren’t likely to fluctuate too significantly,” says Evan Luchaco, an Oregon-based home loan specialist for Churchill Mortgage.
Chris Birk, vice president of mortgage insight at Veterans United Home Loans, also doesn’t believe a drop in rates is imminent next year either.
“Buyers waiting for a major drop in mortgage rates should understand that a sudden decline isn’t likely around the corner,” Birk says. “If mortgage rates come down in 2025, it’ll likely be a slow roll.”
Delaying your dream of homeownership for months means missing out on the chance to start building equity — and potentially missing out on a property you love.
“Finding the right home is the most important aspect of the home buying process,” Luchaco says. “A home that achieves your goals for the immediate future will help get you to where you want to be long term.”
Lower mortgage rates could cause a spike in home prices
There’s another important financial reason not to put off your purchase. While a lower mortgage rate could mean reduced borrowing costs, this could be offset by changes in the housing market that a rate drop brings.
“Waiting to buy might not wind up being worth it for a simple reason – rising home prices,” Birk says. “Depending on your price range, your market, and other factors, higher home prices might offset any dip in interest rates. The $400,000 house you love today might cost way more next summer between home price appreciation and the crush of buyers that lower rates might bring.”
Darren Tooley, a senior loan officer at Cornerstone Financial Services, notes that prices could rise rapidly next year.
“Historically, home values have gone up 6.24% in the year following a presidential election, but 2025 could exceed that due to the limited housing supply and an increase in buyer competition,” Tooley says.
According to Tooley, mortgage applications increased by almost 50% when rates hit recent lows at the end of September. While some of this change was explained by a spike in refinancing, most of the new loans were for new purchases.
“It’s clear when rates go down, more potential homebuyers will be flooding the market, which will ultimately continue to drive up home prices, making things more expensive next year despite the lower rate,” Tooley says.
The bottom line
Finally, there’s one last important reason not to delay. Buying a home now allows you to lock in today’s prices while opening up the door for a more affordable loan later.
“Today’s homebuyers will almost certainly be able to refinance down the road,” Birk said. “Buying today, with the flexibility to refinance later, could offer a balanced path forward in an uncertain rate environment.”
Watch CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
The page cannot be found
The page may have been removed, had its name changed, or is just temporarily unavailable.
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
CBS News
Jennifer Lawrence and Malala Yousafzai shed light on Afghan women’s fight for freedom in new film
A powerful new documentary is exposing the harsh realities faced by women in Afghanistan under Taliban rule. The film, “Bread and Roses,” is directed by Afghan filmmaker Sahra Mani, produced by Oscar winner Jennifer Lawrence and executive produced by Nobel laureate Malala Yousafzai.
Mani details the grim reality faced by millions of women in Afghanistan under Taliban rule, which drew the attention of Lawrence in 2021.
“My first reaction when watching that was to do what the Taliban did not want us to do, which was give access and facilities to the people on the ground to capture what was happening on the ground in real-time,” she said. “Because obviously the Taliban flourishes in secrecy.”
Some of the strict limitations imposed on women in Afghanistan under Taliban rule include prohibiting women from working, pursuing education, or even leaving their homes without a male escort. They are also barred from singing, playing music, making films, and, more recently, dining at restaurants or purchasing food in public.
Lawrence and her producing partner, Justine Ciarrocchi, set out to reveal these realities in Afghanistan through the eyes of Afghan women. They enlisted Mani to direct the documentary and Yousafzai joined the project as an executive producer to help amplify its message.
When asked why the Taliban opposes women’s education, Yousafzai said, “We have been trying to figure out an answer to that for the past 30 years…I cannot find any explanation that justifies it to me. How can you stop a girl from her school? They come up with these excuses that it’s culture, it’s religion. There is no culture, excuse. The true representatives of that culture are the Afghan women and girls that we’ve seen in the documentary.”
The documentary follows three Afghan women who secretly filmed their protests. Mani said she wanted to capture the intimate moment of their life and give people an opportunity to see what life is like for Afghan woman under a Taliban dictatorship. But she also wanted to encourage by highlighting their strength.
It’s a reality that Lawrence said would be difficult to experience.
“I can’t imagine not being able to take a taxi or being able to listen to music. I can’t imagine if just the sound of my voice was illegal,” she said.
Lawrence, known for her activism, acknowledged the dangers of speaking out but said the stakes were too high to stay silent.
“There’s 20 million women whose lives are in danger,” she said.
Yousafzai, who survived a Taliban attack in 2012, reflected on the ongoing fight for women’s rights.
“What really shook me was the fact that people stand with you once you have survived, but we don’t look at people who are still under a big threat,” she said. “Let’s share our solidarity with them.”
