With interest rates at their highest point in four years and expected to climb higher, South Florida buyers are hoping to lock in rates and purchase their homes quickly, according to an article from the Sun-Sentinel. 

Tirso San Jose, vice president of Boca Raton-based builder SobelCo, told the Sun-Sentinel that rising interest rates can turn so-called “fence sitters” into buyers. SobelCo is currently working on two projects in Fort Lauderdale including Galleria Lofts, a luxury townhome community in Downtown Fort Lauderdale, and 321 at Water’s Edge, a waterfront luxury condo tower in Central Beach. 

Currently a 30-year fixed mortgage rate is 4.58 percent, per Bankrate. That’s a climb since the previous week, when rates were 4.53 percent. And it’s a significant climb since January, when rates averaged at 3.95 percent. 

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Think about it: over the course of a 30-year loan for $300,000, a buyer’s total cost after principal and interest would be $550,830. Compare that with even a slightly lower rate at 3.95 percent—over the course of 30 years, that same buyer’s total cost after principal and interest would be $512,502. Buyers in a scenario like this would end up paying $38,328 more in interest and principal over the life of the loan (you can plug in your own numbers using this tool, but remember, there are more things to consider than what these simple mortgage calculators reveal.) 

There’s more at play than just interest rates, too. In Q3 of last year, several South Florida zip codes saw significant year-over-year increases in home prices. Add that to expert predictions that it’s a seller’s market in 2018, particularly for modestly priced condos and single-family homes of every price, and you can see why would-be buyers are rushing to sign on the dotted line.

But not everyone is so willing to rush, and buying a home isn’t exactly the time for quick decisions (especially quick decisions that come with a 30-year monetary commitment). According to a recent study, respondents were slightly more likely to slow down their search in hopes interest rates come down. The results showed that 21 percent of respondents would speed up to quickly find a home before rates rose any higher. Another 21 percent said it wouldn’t change their urgency, but it would change their expectations: they’d settle for less square footage or a less desirable neighborhood. However, 27 percent of respondents said they’d take the opposite approach, cooling off their house hunt and keeping a careful watch for lower interest rates.

As the Sun-Sentinel sums up, “loan payments weigh heavily on consumers’ monthly budgets,” and there isn’t a whole lot the consumer can do when it comes to interest rates. Saving for a down payment until you can meet the ideal 20 percent down payment is one way to keep costs down and avoid the added expense of private mortgage insurance (PMI). Another way is to keep your eyes peeled for great properties in great neighborhoods by browsing right here on Neighborhoods.com.