Should you buy a home with mortgage rates above 7%?

Mortgage rates are back above 7%. Mortgage News Daily's index had the 30-year fixed at 7.29% on October 29, compared with 6.27% a year ago. The Fed held its policy rate at 3.75%–4.00% on October 28, and markets now see a December hike as likely. With inflation running at 3.7%, nobody credible is calling for a fast drop.

So the question we hear every week is a fair one: should I buy now, or wait? Here's how we walk clients through it.

What a lower rate is actually worth

Rates matter, but the difference is smaller than the headlines suggest. On an $800,000 loan, the 30-year principal-and-interest payment is about $5,480 a month at 7.29%. At 6.29% it's about $4,950. That full point is worth roughly $530 a month.

That's real money. But it only helps you if rates actually fall that far, and if home prices, competition and your own situation stay put while you wait. None of those are guaranteed.

What waiting can cost

Right now buyers have something they haven't had in years: leverage. Nationwide inventory reached 1.60 million homes, the most since 2019, and pending sales fell 7.3% in September. More listings and fewer competing buyers mean more room to negotiate on price, repairs and closing credits.

If rates drop sharply, that leverage tends to disappear quickly. Buyers who were waiting all come back at once. You might get a lower rate and pay a higher price for the same house, or lose it to a multiple-offer situation.

Use today's leverage to buy down the rate

Instead of asking for a lower price alone, many of our buyers are asking sellers for credits toward a rate buydown:

• Temporary 2-1 buydown. The rate is 2 points lower in year one and 1 point lower in year two. It eases the first two years while you wait to see where rates go.
• Permanent buydown. Credits pay discount points that lower the rate for the life of the loan.
• Closing-cost credits. Keep more cash in reserve, which also strengthens your file.

A seller credit often does more for your monthly payment than the same dollar amount off the price. We'll run both versions side by side before you write the offer.

When waiting does make sense

Buying isn't always the right call, and we'll tell you when it isn't. Waiting is usually smarter if:

• The payment only works if rates fall. Buy a home you can afford at today's rate, not a hoped-for one.
• You may move again within two or three years, so closing costs won't have time to pay off.
• Your reserves would be thin after closing, or a job or income change is coming.

The bottom line

Buy when the payment works for your budget today. If rates fall meaningfully later, a refinance can capture the savings. If they rise, you've already locked. Self-employed, investing, or paid in ways a W-2 doesn't capture? Our non-QM programs, including bank statement and DSCR loans, follow the same logic.

Want your real numbers? Get a quote in about 3 minutes, or see this week's figures in our weekly market update.

Rates cited are Mortgage News Daily index averages as of October 29, 2026; inventory and pending-sales figures are national. Payment examples are principal and interest only and exclude taxes, insurance and HOA dues. This is educational content, not an offer of credit or a commitment to lend.