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Homebuyers distressed as mortgage rates hit 20-year high

'We may be kicked out of Palm Beach. We may have to consider moving elsewhere'
Mortgage Rates
Posted at 6:16 PM, Oct 15, 2022
and last updated 2022-10-15 18:16:03-04

PALM BEACH COUNTY, Fla. — Recent interest rate increases by the fed are causing some major disruptions in the housing market.

Economists say while the moves were intended to cool off inflation, it’s also making it harder for potential homebuyers to land a home.

Genide Nazaire has been house hunting for two years.

“It’s just been really hard,” said Nazaire. “We got prequalified for a certain amount that just was not what the market was giving.”

The latest figures show mortgage rates have hit a 20-year high, forcing Nazaire to stay put.

“We have just renewed our lease, which we did not plan on doing two years ago,” said Nazaire. “Everything is so high. So, homes that were initially going for like 250 to $300,000 back in 2018/2017 are now 5 to $600,000.”

Genide Nazaire
Genide Nazaire

According to Freddie Mac, the average rate for a 30-year fixed rate mortgage was 6.92%. That’s the highest average rate since April 2002, and more than double what the rate was a year ago.

“Either the prices have to come down a little bit or you’re going to have more people that have the money from other states, investors and such, buying up all the real estate,” said Michael Brooks, realtor.

Brooks said while he's still been very busy because of the overall interest in the market, high interest rates are tough for those struggling to buy a home.

“In the Florida market, the property values have gone up 30% from the previous year basically pricing everybody out of the market,” said Brooks.

Habitat for Humanity of Palm Beach County works to ensure families in our area can have a home.

“For low-income folks, it’s impossible,” said Peter Gates, CEO for Habitat for Humanity of Palm Beach County. “Without nonprofits like us, these folks would have no chance.”

Habitat hosted its annual "Over the Edge" fundraising event on Saturday. Dozens donated for the chance to repel down a West Palm Beach high-rise building.

Habitat for Humanity's Over the Edge event
Habitat for Humanity's annual "Over the Edge" event in West Palm Beach.

“It’s more about doing something that seems impossible,” said Gates. “It drives home the message that we’re doing something else that’s very difficult but very necessary by building homes and repairing homes in Palm Beach County for low-income folks.”

The reality is as long as inflation is still an issue, prospective home buyers like Nazaire will continue to wait for an opportunity.

“I don’t see the light at the end of this tunnel,” said Nazaire. “We may be kicked out of Palm Beach. We may have to consider moving elsewhere.”