Roughly 72% of potential homebuyers say homeownership would be financially feasible if mortgage rates fell below 5%, according to a recent survey from Realtor.com. That means mortgage rates would need to drop by at least 2% to unlock today’s unaffordable housing market.
But there’s a problem. Major forecasts don’t call for mortgage rates to slip under 6% until 2025.
Between last November and early January, the average rate for a 30-year fixed mortgage, the most popular home loan type, fell from a high of 8.01% to the mid-6% range, according to Bankrate, CNET’s sister site. However, throughout February, rates have gone up and kept steady at around 7.25%.
Though mortgage rates aren’t expected to fall dramatically this year, any dip is good news for homebuyers. If home loan rates manage to reach the low-6% range by the end of the year, it would increase housing affordability for a large number of families who have been stuck on the sidelines.
Will 6% be the magic mortgage rate to kick-start the housing market? Or will we need to wait for 5% rates a year from now? Here’s what experts are saying.
Mortgage rates: Rise like a rocket, fall like a feather?
The recent surge in mortgage rates was fueled by hotter-than-expected inflation and labor data, which sent the 10-year Treasury yield (a key benchmark for the 30-year fixed mortgage rate) higher. But in some ways, rates were just recalibrating to an appropriate level.
“Investors got a little ahead of themselves in terms of expectations for lower rates this year,” said Keith Gumbinger, vice president of mortgage site HSH.com. Given the state of the economy — like sticky inflation and the Federal Reserve’s reactive monetary policy — financial markets may have been overly optimistic in projecting when interest rate cuts would start.
After nearly two years of aggressive interest rate hikes to tame inflationary pressures, the Fed signaled in December it would likely cut rates three times in 2024. Though the Fed doesn’t directly set mortgage rates, a lower federal funds rate, combined with cooler inflation, would help mortgage rates go down.
Overall forecasts still project mortgage rates to decline, but exactly when and by how much is murkier. Before adjusting the federal funds rate, the central bank wants to see inflation steady at its 2% year-over-year target.
Even if economic data points to a slowdown, mortgage rate movement will likely be slow and gradual, so 5% rates aren’t in the cards this year.
Read more: Mortgage Predictions: How Labor Data Could Impact Mortgage Rates in 2024
Will mortgage rates go below 6% this year?
Mortgage rates tend to be volatile and preemptive. Rate movement depends not on what’s happening now, but on what investors and lenders believe will happen in the future, according to Orphe Divounguy, senior economist at Zillow Home Loans.
“Today’s mortgage rates, to some extent, already reflect expectations of slowing economic growth and future Fed rate cuts,” Divounguy said.
While next month’s economic data could change the equation, expectations for mortgage rates haven’t changed much. Rates in the low-6% range are still possible in 2024, just not in time for the spring homebuying season.
What the experts are saying
“If we’ve learned anything over the past few years, it is that mortgage rates and other financial conditions can shift rapidly as conditions change. My base expectation is that mortgage rates will decline more gradually and not break below 6% in 2024.”
“As the Federal Reserve holds interest rates steady before beginning to slowly cut rates in May, the spread on the 30-year fixed-rate loan and the 10-year Treasury bond will normalize, and mortgage rates gradually will fall. That said, forecasting mortgage rates is challenging, and near-term volatility is likely. While the rate will trend lower, there is uncertainty in the month-to-month movement in rates.”
“A 6-8% range can be a possible outcome if inflation remains stickier and higher than expectations, and the Fed does not cut until much later than the second half of this year. If the soft landing scenario occurs, then we could see a range closer to 5-7% once the Fed starts to cut rates later in 2024.”
“I don’t think present conditions change the overall forecast for mortgage or other interest rates all that much, but sustained higher economic growth or more persistent inflation would.”
Is 6% an affordable mortgage rate?
Today’s mortgage rates feel high, even if they’re not in a broad historical sense.
Most prospective first-time homebuyers have witnessed low rates over the past decade, especially when they hit rock bottom in the 2% to 3% range during the pandemic. Current buyers likely weren’t on the market for a home in the 1980s, when rates peaked above 18%.
What’s considered an affordable mortgage rate depends on your financial situation. Broadly speaking, a good mortgage rate is generally at or below the national average. The median 30-year mortgage rate since 1971 is 7.4%, according to Freddie Mac.
For many homeowners, the mortgage rate they start with is only temporary: They refinance to a lower rate when mortgage rates drop.
Mortgage rates feel so high nowadays because of the housing market’s overall affordability crisis. Home prices keep rising, inflation is cutting into wages, and debt from credit cards and student loans continue to chip away at savings. All those factors combined have put homeownership out of reach for middle-income and low-income Americans.
Comparing 6% vs. 7% vs. 8% mortgage rate
If you’ve been waiting for rates to plummet before buying a home, doing some basic calculations might change your perspective. Yes, a 6% mortgage is higher than just four years ago. But it’s still a better deal than an 8% or even 7% mortgage rate.
What difference does 1% or 2% make?
Does a 1% drop in mortgage rates make a difference in your monthly payment? The answer is yes. What about a 2% drop? Even more.
Using CNET’s mortgage calculator, we did the math to demonstrate what a 1% or 2% difference can make on your home loan payment. In the chart above, we assumed a 20% down payment on a $500,000 home, making a total loan amount of $400,000 with a 30-year fixed term comparing a 6%, 7% and 8% rate.
Getting a home loan at a 6% interest rate versus a 7% rate gives you savings of $263 a month. That’s $3,156 a year and $94,683 in total interest over the life of your loan.
The savings are even bigger when comparing a 6% interest rate with an 8% rate: The lower rate saves you $537 per month, $6,444 per year and $193,267 in total interest paid.
Pro Tip: Even if you’re getting a lower interest rate, pay attention to lender fees and other costs. Excessive fees or mortgage “discount” points are often hidden and can offset the savings.
For example, a lender might advertise a below-average rate, let’s say 6%. But that’s often based on the borrower having an excellent credit score and paying discount points in exchange for that low rate, which can cost thousands of dollars upfront. Each mortgage discount point results in a 0.25% decrease in your rate but will typically cost 1% of the loan amount.
How to get a lower mortgage rate
While it’s important to keep track of current mortgage rate trends, the best thing to do is focus on doing things like improving your credit score, paying off debt and saving for a bigger down payment.
Many mortgage lenders advertise lower-than-average interest rates. But to qualify for those low rates, you’ll need to have excellent credit, a low debt-to-income ratio and (typically) a down payment of at least 20%.
Experts also recommend comparing loan offers from at least two different mortgage lenders to help you secure the best deal.
In today’s volatile housing market, ensuring your home is protected against unexpected repairs and replacements is more crucial than ever. As homeowners seek peace of mind amidst the unpredictability of homeownership, home warranty companies have stepped up to offer a buffer against unforeseen expenses.
5 Best Home Warranty Companies
With so many options available, pinpointing the most reliable and value-packed home warranty company can be daunting. To help you choose, we’ve curated a list of the best home warranty companies to ensure your home’s systems and appliances receive the top-tier coverage they deserve. Take the time to discover which provider aligns best with your needs.
#1 Choice Home Warranty
There are plenty of reasons to go with Choice Home Warranty. First, they are a top-rated business according to ConsumerAffairs.com and have an average rating of 4.8 out of 5.
They have a five-star rating from Trust Pilot, and Inc. 5000 has recognized them as one of America’s fastest-growing private companies.
Choice has customer service available 365 days a year, 24 hours a day, 7 days a week. So if you’ve got a problem, don’t be afraid to pick up the phone and call them.
They are more than happy to answer any questions about your home warranty plan or, if need be, put in a request for a repair. A licensed, pre-screened, and continuously monitored technician will come to your house, usually within one or two business days.
The age of your home, its systems, and appliances is not relevant to Choice Home Warranty. They always cover items that have been properly maintained and were in well-working order when coverage was initiated.
If the item in question needs to be replaced but is no longer available on the market, they will give you a cash payment of the item’s replacement cost.
Another plus is that you don’t even have to get your home inspected before Choice Home Warranty will begin offering you coverage.
Choice also has a very reasonable $85 dollar service call, which makes them among the most competitive warranty providers for service calls.
Plan Options
1. Total Plan ($450 a year)
Includes coverage on the following —
AC
Heating
Electrical
Plumbing
Water Heater
Whirlpool
Refrigerator
Oven
Dishwasher
Microwave
Garbage Disposal
Washer and Dryer
Ductwork
Garage Door Opener
Ceiling and Exhaust Fans
2. Basic Plan ($378 a year)
Includes coverage on everything mentioned above, EXCEPT:
AC
Refrigerator
Washer and Dryer
Items that can be added at additional cost include:
Pool
Central Vacuum
Well and Sump Pump
Limited Roof Leak
Stand Alone Freezer
Second Refrigerator
Septic System
Septic Pumping
Read our full review of Choice Home Warranty
#2 Advanced Home Warranty
Advanced Home Warranty offers comprehensive coverage and a 24/7 claims hotline, making it a strong choice for anyone considering a home warranty.
Home warranties are available nationwide, so you can qualify for a plan, no matter where you live in the U.S. Plus, you can try it out without any risk by signing up to get your first month completely free of charge.
Trade service fees are reasonable at $60. If the cost of the repair is less, you’ll pay the smaller amount. This is one of the lowest service fees available among the providers on our list.
While they don’t offer a wide range of plans, you can get coverage on some of the big-ticket items associated with homeownership.
A low monthly fee can be much more manageable than paying for replacements outright every time an appliance breaks. There are also parts of even larger systems that are included in their coverage.
Here’s a breakdown of the two home warranty plans available from Advanced Home Warranty, how much you’ll pay, and what exactly they include.
1. Basic Plan ($370 a year, plus one month free)
Includes coverage on the following:
Heating System
Electrical System
Plumbing System
Dishwasher
Microwave
Garage Door Opener
2. Total Plan ($450 a year, plus one month free)
Includes coverage on everything above, PLUS:
Air Conditioning
Refrigerator
Washer/Dryers
Do read each home warranty plan for details on exactly how each specific item on the list is covered.
Read our full review of Advanced Home Warranty
#3 Liberty Home Guard
Liberty Home Guard offers a high degree of personalization for your home warranty coverage. For example, you can pick the plan and also how often you want to be billed.
You can choose monthly payments, annual payments, or for the most savings, multi-year home warranty plans.
Liberty Home Guard offers a service call fee of $60, which is a competitive service fee. You can also expect your service call to be delivered within 48 hours of making a claim.
You don’t need a home inspection to qualify for coverage with Liberty Home Guard. There’s also no limit to how many claims you can file within a year.
You can file your claims online for your ease and convenience. And with a 60-day satisfaction guarantee on service, you’re sure to be satisfied with the repair or replacement process.
If for some reason, you want to cancel your plan early, it’s entirely possible because there’s no annual contract. You’ll receive a prorated refund for any time you’ve paid for, except for a small administrative fee.
With Liberty Home Guard, there are three different coverage options you can choose from. You can also include optional add-ons in any plan.
1. Appliance Warranty for $39.99 Monthly or $399.99 Annually
Clothes washer
Clothes dryer
Refrigerator with ice maker dispenser
Built-in microwave oven
Dishwasher
Garbage disposal
Range/ oven/ cooktop
Ceiling and exhaust fans
Garage door opener
2. Systems Guard for $49.99 Monthly or $499.99 Annually
Air conditioning
Heating
Ductwork
Plumbing
Electrical
Water heaters
3. Total Home Guard for $59.99 Monthly or $599.99 Annually
This choice offers the most protection of all the plans and includes everything listed in the two plans above.
4. Optional Add-ons
Pool and spa: $17.00 monthly; $195.00 annually
Sump and pump: $3.00 monthly; $36.00 annually
Central vacuum: $3.00 monthly; $36.00 annually
Well pump: $9.00 monthly; $101.00 annually
Additional spa: $16.00 monthly; $188.00 annually
Septic system and septic sewage ejector pump: $11.00 monthly; $123.00 annually
Stand alone freezer: $4.00 monthly; $44.00 annually
Second refrigerator: $4.00 monthly; $44.00 annually
Read our full review of Liberty Home Guard
#4 Complete Protection
Complete Protection is another excellent home warranty company. Servicing all but nine states, this A+ Accredited Business is open 24/7.
Only slightly more expensive, this once small-scale, family-owned business offers some of the most comprehensive home warranties available in North America.
One of the many benefits offered by Complete Protection is their no-fee service call policy. With most quality providers charging at least $50 per service call, having no service call fee at all is a major perk.
They have five plans you can choose from:
Kitchen/Laundry: $32 a month/ $384 a year — covers your dishwasher, oven, refrigerator, and washer and dryer.
Heating/Cooling: $34 a month/ $408 a year — covers your furnace, AC, and water heater.
Basic Built-ins: $40 a month/ $400 a year — Furnace, AC, water heater, dishwasher, and oven.
Full House: $50 a month/ $600 a year — Furnace, AC, water heater, dishwasher, oven, refrigerator, and washer and dryer.
Full House Plus: $60 a month/ $720 a year — Includes everything mentioned in the first four plans, but also includes electrical wiring and in-bound water pipes.
What makes Complete Protection stand out even more:
There are a few other things that make Complete Protection stand out from its competitors. For one, their home warranties don’t have a deductible. As a result, you don’t have to pay any approved repair costs when something happens — this includes the initial service call, parts, and labor.
Secondly, CP pays for all preventative maintenance. Other home warranty companies mandate that their customers undergo preventative maintenance on items such as HVAC systems, but they won’t even pay for it. Instead, they force their customers to do so!
Thirdly, CP home warranties cover all the parts within an appliance. Most home warranty companies exclude parts like ice makers or washing racks within dishwashers. CP does not pick and choose which parts it will cover.
Lastly, Complete Protection allows you to choose your own service contract provider. So, if you have a certified contractor with whom you work, you can go to them whenever home repairs are needed.
They do this because they feel that their customers should always be comfortable with the person working in their house.
Read our full review of Complete Protection
#5: American Home Shield
The accolades American Home Shield has received are many. In addition to being a Better Business Bureau Accredited Business, they also received the Women’s Choice Award from 2014 to 2016.
On top of that, Home Warranty Reviews gave American Home Shield the Best in Service award in 2014 and ranked them as Top Rated from 2015-2017. Last but not least, they are Consumer Affairs Accredited.
Why so much recognition from the industry? For starters, they’re always open. You can always reach them regardless of what day or time it is. And, when you do, expect a local contractor to be at your home within no more than 24 hours. You don’t even have to get on the phone. You can request home repairs directly from their website.
Another reason American Home Shield is recognized as the best among the best is its versatility with its home warranty plans. They have four to choose from:
Systems Plan: Covers the replacement or repair of your home’s key systems, such as: plumbing, electrical, heating, air conditioning, and smoke detectors.
Appliances Plan: Includes coverage on common, everyday household appliances, such as refrigerators, built-in food processors, dishwashers, and washer and dryers.
Combo Plan: Get coverage on all of your primary home systems and appliances. Saves you $14 a month if you were to rather purchase the systems and appliances plans separately.
Build your own plan: Choose only what you want to be covered by selecting 10 or more items from their list of covered items. This way you get the coverage that you care about the most.
Another element of their customized service is their service fees. American Home Shield allows customers to choose from a service fees range of $75, $100 or $125 per service request. This allows you to get the plan you want without having to account for a high service call fee.
The ability to choose your own service call fee regardless of the plan you’re on separates American Home Shield from most other home warranty companies which carry a standard service call fee.
Additionally, American Home Shield can provide coverage for your pool, spa, well pump, and septic system (at additional costs) and can assist you during the moving process by covering your home while it’s listed. If the new owner decides they would like to upgrade service afterward, it’s an easy switch to do so at closing.
Read our full review of American Home Shield
Methodology: How We Chose The Best Home Warranty Companies
When researching the best home warranty companies, we analyzed over 20 of the most popular home warranty companies. Our team spent hours reviewing each home warranty company. We examined many factors, but mainly focused on the following:
Home warranty plans and options
Pricing
Reputation and trustworthiness
Customer reviews
Pros of Home Warranties
Peace of Mind
One of the major benefits of a good home warranty is peace of mind. A home warranty can bring some real financial security against unexpected home repairs. While getting your home in ideal shape can be tough, maintaining that level can be even more stressful. A good warranty coverage can cut away a big chunk of that worry.
Convenience
One of the biggest problems people can encounter when faced with unexpected breakdown at home is finding good help. But a home warranty also reduces some of that stress, as your provider can provide you with a relevant licensed expert within their network.
Potential Savings
In many cases, standard home repairs – such as a new boiler, for example – can be a lot cheaper if replaced under warranty. While home warranties can’t guarantee savings, chances are you will see the benefits speak for themselves over time.
Transferable
Many home warranties are transferable, meaning you could carry your plan to a new home if you decide to move. Be sure to check whether transferability is a feature of any warranty before signing if that’s important to you.
Cons of Home Warranties
Wait Times
Unfortunately, wait times for claims can sometimes keep you waiting. If you need a quick fix or emergency repairs at home, you may have to wait longer than you would like. One thing that can help here is looking for a provider that provides an online claims process. This is because online claims are often processed faster than those done over the phone.
Coverage Exclusions
Home warranties don’t cover everything, and it can be hard in an emergency to remember your exact coverage limits. It’s important to read the details carefully before signing up, and put a plan in place if you need work that falls outside your warranty coverage.
Cost
Home warranty coverage isn’t cheap, especially if you want to secure protection across your property. You won’t necessarily be covered by service fees, even if you choose a plan with a high service fee. And of course, some maintenance and repairs can come with further costs on top of your plan. These high costs can make it difficult to discern whether a home warranty is the right thing for you.
Other Home Warranty Companies to Consider
Here are a few other home warranty companies that didn’t make our top 5 that you may still want to look into.
Like so many things in our lives, a home warranty is something that we don’t often think about until we absolutely need it. Sure, you have home insurance, maybe even flood insurance, but that only covers certain situations.
Homeowners Insurance
Homeowners or renters insurance can cover damage to your home from things like fire, theft, storms, and some natural disasters. In addition to your homeowners insurance plan, you should choose to purchase a home warranty to protect your belongings in a way that insurance lacks.
If you’ve ever purchased a large appliance, a computer, or even a television from a retailer, then you’re probably familiar with the concept of a warranty.
However, those are warranties sold at the time of purchase and cover only one product. The benefit of home warranty protection is that it can cover every product in your home and more.
Choosing a Home Warranty Plan
What a home warranty plan covers will depend on the plan you choose, and there are many to choose from. A home warranty can cover anything from your microwave oven to your plumbing and your electrical systems.
Deciding which plan is right for you will determine what items and systems it covers and how much it will cost. Typically, home warranties charge either a small monthly or annual fee that can save you a lot of money in the long run.
How to Choose the Right Home Warranty
Choosing the right home warranty is key. Let’s run through all the details you need to consider before making your decision.
Determine Your Coverage Needs
At the very least, it’s important to get at least an idea of what sort of coverage you need. Take the time to decide which items in your home you want to protect before comparing offers. You’ll find plans that cover appliances, home systems, and plans that cover both.
Compare Quotes
It’s worthwhile to shop around. Try to acquire at least three different quotes from plans that you’re genuinely interested in. And use this time to also prioritize clearing up any questions you have about the policies you’ve been offered.
Don’t forget to pay close attention to the various prices you’ll see for service call fees. Some companies are much more competitive than others, and some even offer a service fees range which you can choose from depending on your needs and budget.
Review Sample Contracts & Liabilities
The next step is to review any sample contracts carefully. You’ll want to identify the limitations and exclusions in the contract, especially.
Furthermore, be sure to double-check cancellation policy just in case you decide your warranty isn’t working for you later on.
Check Reviews
Finding the best home warranty company for you will require some further research. You can read customer reviews online to find a company that provides great customer service as well as competitive plans.
Be sure to look out for any record of previous legal action taken against the company, too.
Home Warranty FAQ
What is a home warranty?
A home warranty is a type of service contract purchased to cover breakdowns, repairs, and replacements of home appliances and systems. Home warranties are designed to cover normal wear-and-tear damage on covered items and systems.
When a covered item breaks down or otherwise requires attention, you file a claim with your warranty provider. They then send a licensed technician to your home to assess the issue. Instead of paying for the full cost of the repair, being under warranty generally means paying only a small service fee for necessary repairs. The price of service fees varies between providers.
Home warranties are popular because they offer homeowners maintenance coverage and emergency repairs without having to rely on savings. The home warranty market today is huge and can provide terms for homes and budgets of many shapes and sizes.
What does a home warranty cover?
Home warranties can cover a whole range of systems and appliances within your home. You can decide how much you want to spend and determine what items will be covered by your home warranty.
Most home warranty companies break down their offerings into good, better, and best options. The good option, and least expensive, is one that covers most if not all of your appliances.
Major Home Systems
More expensive on an upfront basis are plans that cover major home systems. These home warranty plans cover the systems within your home. If you’re renting, this may not be of concern to you. However, if you own your home, you know that a plumber or electrician can cost a lot more than replacing your refrigerator.
If you’re less concerned with appliances and worried about what keeps your home humming along, then you may want to consider a system plan.
Appliances
Appliances like your microwave, washer and dryer, dishwasher, and often a lot more are covered by the best home warranty companies. These are great options for those who are renting or want to spend the least amount of money.
Systems & Appliances
The most expensive plans, of course, offer the most coverage. The best plans cover both systems and appliances. So while they’re the most expensive, they’re also the best value. Covering your systems and appliances together will typically save you around 20% to 30% of your total bill.
Basic plans from the best home warranty companies will cover the majority of systems and appliances in your home but don’t cover everything. If you have a pool, for instance, you may have to choose additional coverage.
Some home warranty companies even allow you to add coverage to cover your homeowners’ insurance deductible. Combining appliance and system coverage may also include these additions.
There are exclusions to what a home warranty will cover. Unfortunately, no plan is a blank check to have every item in your home replaced. These are repair plans and not replacement plans.
What is not covered by a home warranty?
The extent of your warranty coverage will vary greatly between companies and plans available. Having said that, however, here is a list of the ideas that are usually not covered by a home warranty:
Structural issues, paint and flooring
Commercial-grade equipment or systems
Pre-existing conditions
Rust, corrosion and sediment problems
Improper maintenance, installation, design, or manufacturer defect
Detection and removal of asbestos and mold
Building and zoning code violations
How much does a home warranty cost?
Home warranty pricing varies greatly depending on the coverage you choose, the home warranty company, and the area in which you live. In general, though, if you’re just covering appliances, expect to pay around $30 a month.
If you’re looking for only system coverage, you’ll probably pay around $35 a month. However, if you combine your coverage to include both systems and appliances, expect to pay around $45 per month.
Adding things not covered by a typical home warranty plan can also increase your monthly bill. If you have an atypical appliance or system, it’s possible that basic plans do not cover it. Not everyone has a swimming pool, a septic tank, a whirlpool tub, or a spa.
Check with your individual plan to ensure that all systems and appliances you want to have covered are actually included. If they aren’t, see if you can add them separately.
Service Fees
In addition to your monthly fee, you’ll also need to pay service fees for a service call. This cost can vary greatly.
The best home warranty companies offer plans that will cost you around $50 to $125 per repair. This is based on the home warranty company, the plan, and the item that needs to be fixed. While this may seem like a lot, consider the cost of the average repair without a warranty.
What can you expect to pay without a home warranty?
The average repair cost of a refrigerator is $275 to $325. The igniter on an oven or range may only cost $110 to $200 to repair, but a control board could cost you more than $260.
Replacing a rubber gasket on your washer will set you back between $200 to $300. These expenses can quickly add up compared to the fee home warranty companies charge for a visit.
Bottom line: They’ll address the issues with your current item but won’t give you a new one.
Pre-Existing Conditions
Pre-existing conditions are not covered either. Unfortunately, if one of your major appliances breaks, you can’t just sign up for coverage and expect to have it fixed.
Most home warranty companies will cover an unknown pre-existing condition. However, you can’t have an appliance covered if you or the home warranty provider knows that it’s already broken. This is why it’s a good idea to think about purchasing home warranty coverage before your appliances break.
Coverage Waiting Period
Most companies impose a 15 to 30 day waiting period before coverage can begin. There are, however, exceptions to this rule. For instance, if you have a home warranty that is ending soon, you may be able to begin on the date your coverage stops.
It’s important to read the fine print of your service contract. Each home warranty company will have very specific coverage details.
While all will most likely cover your refrigerator, not all of them will cover wear and tear on the gasket that seals it. Typically, the more expensive the plan, the more it covers, but this is not always the case.
What is the process for having an item repaired?
When something breaks, especially if you have a home warranty, you’ll want it fixed as quickly as possible.
Going without a microwave for a week or two may be acceptable, but if it’s your refrigerator, you may not be so patient. When an item malfunctions or breaks, you’ll need to contact your home warranty company’s customer service and explain the issue.
Make sure you report the problem as quickly as possible. The faster you make the call, the faster you’ll get an appointment and have your issue resolved.
Independent Contractors
The home warranty provider will most likely assign an independent contractor to inspect and repair the item. Obviously, system repairs can take longer and be more labor-intensive.
For example, replacing a part on your furnace will be a lot easier than repairing electrical wiring or plumbing inside your walls.
Depending on what is wrong, the contractor may have to order parts or return with specialized equipment. You’ll be required to pay a service fee for each item you wish to have repaired. However, the contractor should ensure that the item returns to working order.
Workmanship Guarantee
Once you’ve had an appliance or system repaired, that item is covered under a workmanship guarantee. Think of it as a warranty within your warranty.
The home warranty provider guarantees the parts and labor of that particular repair for a specified amount of time. This is usually around 90 to 180 days after the repair. So, even if you cancel your plan, they will still cover the repair during that time.
Who should pay for a home warranty?
Many times the seller will buy a home warranty to make the purchase of the home more appealing. Sometimes a real estate agent will even purchase a home warranty as a courtesy to the clients they’re representing. However, buyers, sellers, real estate agents, and current homeowners can all buy a home warranty. It’s also important to note that buying a home warranty can be done at any time, before or after closing.
What should you look for in a home warranty company?
A home warranty can save you a lot of hassle and headaches, not to mention money, down the road—as long as you do your homework and think it through.
A home warranty covers many things that homeowners insurance does not. Having peace of mind knowing that costly home repairs won’t spring up unexpectedly is a great feeling.
Choosing the right type of coverage for you is the next step. When you think about the type of coverage you want, think about the items you want to protect in your home.
Renters
If you’re just renting, then plumbing and electrical work is not a concern for you. Your homeowners insurance should cover things like theft and fire, but you still want to be covered when something breaks that you actually own. Choosing an appliance plan is probably the right option for you.
If you live in an older home that you own, a more comprehensive plan may be the right choice for you. It’s comforting to have your home inspected before purchasing, but things can still go wrong. You can avoid costly maintenance as long as you plan ahead.
Are home warranties worth it?
The answer to this question will depend largely on your unique circumstances. Two of the biggest factors are the age of your home and the quality of your appliances. In addition, your own ability and comfort with repair and maintenance is a factor.
Almost every home appliance and system will eventually require significant repair or even replacement. Depending on your own DIY skills, you might be comfortable taking responsibility for most repairs. Others might want more comprehensive coverage. But even still, there could be plenty of reasons why you would prefer to have a home warranty.
How do I cancel my home warranty?
Your first step should be to review your contract and make sure you understand the cancellation policy. Most companies will charge a cancellation fee that can range from 5% to 10% of the outstanding fee.
Thereafter, you can contact the company and tell them you’re considering cancelling your warranty. If possible, try to speak to a sales rep with whom you’re familiar.
Some companies require you to send a written notice of termination. Remember to cancel any automated payments from your credit card or bank account, if necessary. It might also be a good idea to request a written confirmation of the cancellation for your records.
Which home warranty company has the lowest service call fee?
Service call fees can vary widely between companies, but it’s important to try to find the most competitive service call fee available to you. Service fees generally range from $50 to $150 per service call.
The trick with finding a competitive service fee call is making sure you don’t sacrifice the quality of service calls. Some of the top-rated home warranty companies charge a higher service fee. However, it could be worth it to have the security and confidence of quality home service.
Final Thoughts
To find the best home warranty company, you will need to read the contract thoroughly. Every company that you investigate will have a contract. In that contract, they’ll spell out exactly what they do and do not cover.
They’ll also explain the cost, who will fix your items if they break, and more. Comparing two or more home warranty companies can give you a sense that you’ve made the right decision. Always make sure you do your homework.
Furthermore, check to see if a home inspection is required before qualifying for a home warranty with a specific company. Many don’t require this extra step, but it’s wise to be prepared in case they do. You definitely want to consider both cost and convenience as part of your ultimate decision.
Full Reviews of Home Warranty Companies
Looking for more options? Check out our other home warranty reviews below.
Are people still spending money on home improvements despite rising housing costs and inflation? According to Opendoor’s 2024 Home Decor Report, the answer is yes. In fact, the average American will spend $5,635 on home remodeling projects this year.
We reviewed Opendoor’s data and spoke with a design expert to get insights on this year’s home decor and renovation trends. When it comes to how homebuyers (and renters) are prioritizing their spending, we learned that paint makes a difference, kitchens renovations are top of the to-do list, and new or repurposed decor can liven up a space. Beyond that, here are some of the most popular home upgrades American homeowners want to try ASAP.
About the Survey
Opendoor surveyed 1,041 homeowners ages 25-74 who have decorated or remodeled in the past two years or have shown interest in doing so.
Popular Home Renovations
When asked about their top-priority remodeling project, 33 percent of respondents said painting, and another 27 percent said the kitchen. Here are some other important upgrades Americans want to make in their homes.
Updating Light Fixtures
For a relatively easy home renovation that may or may not require a handyman, 25 percent of homeowners want to update light fixtures before anything else. The scale and design of overhead lighting can make a significant impact on the look and feel of a space.
Installing New Flooring
Updating floors is the most important home renovation for 24 percent of homeowners. While the cost and labor can be significant, a fresh wood floor or carpet can make a space feel brand new. However, if the scale of this project is too much for the moment, consider a new area rug or a different paint color to offset dated flooring.
Upgrading Kitchen Cabinets
Of all the kitchen renovation projects, 22 percent of homeowners say they want to (or have already) installed new kitchen cabinets. Trendy kitchen cabinet styles come and go, but for longevity, consider a style that coordinates with your home style. For example, shaker-style cabinets look great in older Craftsman homes, while slab-style cabinets work well in homes from the mid-century. If new cabinets aren’t in the budget, consider repainting them to give them a fresh, new look.
Replacing Kitchen Counters
Kitchen counters are the most important project for another 22 percent of homeowners. It’s an upgrade you can do on its own or with a full-scale kitchen renovation. While granite and quartz are popular among homeowners, home design expert Dabito prefers marble. “I think Calacatta marble is making a big splash in the kitchen. It has a lot of bold, unique veins that can add movement and texture in a kitchen space,” he says.
Dabito is an interior designer, color expert, and creative director at Old Brand New.
Affordable Projects
Not all home renovation projects need to break the bank. In some cases, they don’t even involve demolishing a space. Here’s how homeowners plan to save money when updating their homes.
Painting a Room
Painting a room was the highest priority home renovation listed in the survey, but it was also chosen as the most affordable. According to Opendoor’s 2024 Home Decor Report, the top home colors are (in order of popularity):
Off-white
Light gray
Beige
So we can expect these to show up quite a bit in renovation projects next year. “These colors can provide a sense of calm for those living in (and visiting) a home. Traditional neutrals offer a blank slate for home shoppers to easily envision their style,” Dabito says.
“That said, I’m big on color, so I anticipate that the ‘new’ neutrals will be muted tones that are grounded and offer stability—think light blue, light green, dusty rose, and eggshell yellow,” he explains. Dabito also suggests that many paint color brands’ 2024 Colors of the Year are in line with that assumption, with many choosing subdued blues and greens as emerging shades. “These colors can add warmth to a space without overwhelming the senses,” he says.
Buying Seasonal Decor
Updating your seasonal decor is the most affordable to update your home, according to 55 percent of homeowners. But does this count as a home renovation? Sure, if you consider that a renovation can include any project that improves a home, whether that be cosmetic, structural, or a decor change that improves the visual appeal of a space. (Think of how effective home staging is when you sell your home.) Try swapping out fabrics throughout your home from cotton and linen in the warmer months to velvet and wool in the winter.
Changing Furniture
Some house projects won’t require spending at all. Changing the layout of your furniture was chosen as the best wallet-friendly update by 49 percent of homeowners. And Dabito is a fan of using what you have to make a big change.
“Changing furniture is a great way to make a space feel new—without having to change a home’s structure or layout,” he says. “One of my favorite tips is to use furniture as a divider. Try moving your sofa, so it becomes the separator between a living area and the kitchen, for instance. Or, you can have your furniture float in the middle of the room rather than against a wall.”
Dabito
Flow in any space is important, so reimagine your bedroom or living room in a new layout that might offer a better flow. I also love round coffee tables for smaller living spaces because they’re more inviting.
—Dabito
Eco-Friendly Upgrades
Sustainable projects can save money, so these home renovation trends are excellent for your wallet and the earth. Here’s how homeowners take care of their environment while upgrading their homes.
Refinishing Existing Materials
Just because your furniture and decor seem dated doesn’t mean you need to toss it. Homeowners agree that refinishing existing materials is a conscious way to update your home without adding to the landfill.
“One of my favorite ways to refinish existing materials is to let the natural beauty of an existing piece shine through, says Dabito. “Peel-and-stick tiles are fantastic for any outdated tilework in a kitchen without having to commit to a full-on renovation.”
Investing in Dimmers
Installing dimmers is a relatively easy DIY project that improves energy savings. Also, dimmers can enhance your quality of life by providing a range of brightness throughout the day. Just remember to turn the lights off completely when you leave the room for maximum energy conservation.
Refinishing Old Furniture
Just like refinishing materials in your home, you can also give your old furniture an upgrade. Staining or painting wood furniture is a beginner-friendly project and will make use of materials that would have otherwise been tossed.
“Staining a wood furnishing like a side table or cabinet is a great way to make its natural qualities stand out while making it feel new. On the flip side, I also love reimagining an old piece with a fresh coat of paint,” Dabito says.
While we firmly believe that home is where the heart is, we also know that unnecessary clutter and disjointed decor can encourage chaos rather than comfort in our most treasured spaces. The first step of any home improvement is to declutter your existing collection of items and decor, choose which items deserve a spot in your updated space, and then immediately get rid of the excess stuff.
Once you’ve cleaned out your existing collection, create an attainable mood board of your ideas, colors, decor pieces, and furniture that will best reflect your goals for that space. Once you decide on your home aesthetic, you can begin shopping and then staging your home!
Finding an aesthetic that inspires your best self isn’t as difficult as it may sound! We’ve compiled a list of popular home decor styles that are easily integrated into your home – big or small. If you’re looking for more ideas, check out this article on last year’s major trends.
Let’s get into it!
Evie’s product selections are curated by the editorial team. If you buy something through our links, we may earn an affiliate commission, at no cost to you. We only recommend products we genuinely love.
Coquette
Love the frills of the coquette aesthetic? We do too! This trending fashion aesthetic is an ultra feminine home decor style that is easy to put together – even if you aren’t an interior decorator. The color scheme of this aesthetic is pink and white, with an emphasis on bows, florals, and simplicity. If you want to fully commit to both the style and home decor aesthetics, your beauty products can double as tabletop decor – display your fragrances and hair accessories as the focal point of the room.
Here are a few of our coquette picks to inspire your decor refresh!
Artfully Walls I Still Read Fairy Tales Wall Art, $158
UO Big Bow Comforter, $200
UO Home Heart Stemmed Bud Vase, $12
Eclectic Grandpa
The eclectic grandpa aesthetic has been trending on TikTok for a while, and the home decor inspo is a perfect combination of colors, patterns, and shapes that encourage the ultimate cozy living space. While you may not want to camp out on another trending aesthetic, this term is quite helpful in defining your search and describing your design goals before you revamp your space!
The eclectic grandpa aesthetic is essentially a muted version of your grandparents’ house, with an emphasis on bookshelves, dark wood, and vintage items. In a sense, the aesthetic is organized clutter with a muted color scheme and lots of greenery. To accomplish this decor look, you’ll need a variety of books (perfect items to thrift) as well as a central coffee table in your living room for eclectic items.
Need to add a few pieces to your home decor? Check out our picks!
Uma Fluted Glass Lamp, $68
UO Vinyl Record Storage Shelf, $119
The Terrain Houseplant Book, $35
Garden Party
Flowers are the original home decor piece, so creating a space that feels natural and inviting requires a floral emphasis. Play with different patterns that include one continuous shade, such as green, so your space reflects your favorite garden space. Shelf decor should include fresh flowers, and your wall decor can feature your favorite blooms in whatever art style you prefer!
Let’s update your garden decor with a few new pieces!
Artfully Walls Blushing Wall Art, $178
Nathalie Lete Embroidered Velvet Pillow, $78
UO Botanical Stemmed Wine Glass, $14
Anthropologie Eden Platter, $68
Modern Farmhouse
While the farmhouse home decor aesthetic has been popular for a while, there are plenty of ways to accomplish this soft, clean decor style without caving to outdated, millennial basics. To keep this decor style fresh, you’ll need to incorporate a variety of different textures into your space, as well as some simple patterns that will cohesively blend with the range of beige and white tones. Patterned wallpapers are a major decor trend this year, which add the perfect final touch to your home!
Ready to update your “sad beige” home into a modern cozy oasis?
Farrow Ball Closet Stripe Wallpaper, $225
Safavieh 24in Flora Seagrass Table Lamp, $60
Anthropologie Carved Wooden Cake Stand with Glass Dome, $38
Coastal Classic
If you’re holding on to the remnants of the coastal grandmother aesthetic, this coastal classic home decor aesthetic is an elevated way to design your space. Light blue will be the primary color focus of your decor, along with bright shades of white and a classic wood finish.
To avoid the instantly outdated components of this aesthetic, stay away from obvious artwork and decor elements that focus on ocean creatures. Shells, starfish, and boat shapes can be used in a classic way, but shouldn’t be the defining feature of your coastal classic home!
Need to add a few new coastal pieces to your living room? Check out these gorgeous items!
UO Toile Duvet Set, $100
Safavieh 26in Nissa Table Lamp, $70
Abrams Hardcover Coastal Blue Coffee Table Book, $40
Terrain Blue Floral Ceramic Vase Tall, $24
Elevated Preppy
Preppy home decor often invites the IG reels of sorority houses and dorm room decor to mind. However, there is an updated version of this bubbly pink and blue decor theme for your post-grad needs! The base of your home decor will be bright white (not beige), and the accents will feature pink and blue illustrations and objects. A white bed frame, bedspread, and bedside table create the perfect canvas for pink pillows, preppy artwork, and related items.
Here are a few fun home decor items to add to your collection!
Anthropologie Candace Mirror, $378
Balta 5X7 Covey Checkered Shag Rug, $70
Alja Horvat Yumi Cherry Tray, $59
Closing Thoughts
Choosing a home decor aesthetic is step one to enjoying your newly furnished place. Decorating your home should spark joy!
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National mortgage rates were mostly down compared to a week ago, according to rates data collected by Bankrate. Average rates for 30-year fixed, 5/1 ARMs and jumbo loans receded, while rates for 15-year mortgages increased.
Mortgage rates could gradually come down this year, according to Greg McBride, CFA, Bankrate chief financial analyst. Rates began retreating in the back half of 2023 as inflation continued to cool and the Federal Reserve halted rate increases. The central bank now forecasts rate cuts in 2024 — a move that would have broad economic impact, including on the 10-year Treasury, a key benchmark for fixed-rate mortgages.
“The 10-year Treasury yield that serves as a baseline for fixed mortgage rates will have a bouncy journey lower, moving back above 4 percent early in 2024 but trending lower as inflation cools and the Fed gets closer to cutting rates,” says McBride. “For mortgage rates, that portends a general downtrend — albeit with fits and starts — in 2024.”
Rates accurate as of January 29, 2024.
The rates listed here are marketplace averages based on the assumptions shown here. Actual rates available on-site may vary. This story has been reviewed by Suzanne De Vita. All rate data accurate as of Monday, January 29th, 2024 at 7:30 a.m.
Today’s 30-year mortgage rate eases, -0.04%
The average rate you’ll pay for a 30-year fixed mortgage today is 6.99 percent, down 4 basis points over the last week. Last month on the 29th, the average rate on a 30-year fixed mortgage was unchanged, at 6.99 percent.
At the current average rate, you’ll pay principal and interest of $664.63 for every $100,000 you borrow. That’s down $2.69 from what it would have been last week.
The 30-year mortgage is the most popular home loan, and it has a number of advantages. Among them:
Lower monthly payment: Compared to a shorter-term mortgage, such as 15 years, the 30-year mortgage offers more affordable monthly payments spread over time.
Stability: With a 30-year fixed mortgage, you lock in a set principal and interest payment, making it easier to plan your housing expenses for the long term. Remember: Your monthly housing payment can change if your homeowners insurance premiums and property taxes go up or, less likely, down.
Buying power: Because you have lower payments, you might qualify for a bigger loan or a more expensive house.
Flexibility. Lower monthly payments can free up some of your monthly budget for other goals, like saving for emergencies, retirement, college tuition or home repairs and maintenance.
15-year mortgage rate moves up, +0.01%
The average rate for the benchmark 15-year fixed mortgage is 6.50 percent, up 1 basis point over the last week.
Monthly payments on a 15-year fixed mortgage at that rate will cost approximately $871 per $100,000 borrowed. The bigger payment may be a little harder to find room for in your monthly budget than a 30-year mortgage payment, but it comes with some big advantages: You’ll save thousands of dollars over the life of the loan in total interest paid and build equity much faster.
5/1 ARM rate retreats, -0.26%
The average rate on a 5/1 ARM is 6.12 percent, down 26 basis points over the last week.
Adjustable-rate mortgages, or ARMs, are mortgage loans that come with a floating interest rate. In other words, the interest rate will change at regular intervals, unlike fixed-rate mortgages. These types of loans are best for people who expect to refinance or sell before the first or second adjustment. Rates could be materially higher when the loan first adjusts, and thereafter.
While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.
Monthly payments on a 5/1 ARM at 6.12 percent would cost about $607 for each $100,000 borrowed over the initial five years, but could increase by hundreds of dollars afterward, depending on the loan’s terms.
Jumbo mortgage interest rate moves down, -0.05%
The average jumbo mortgage rate today is 7.02 percent, down 5 basis points from a week ago. A month ago, the average rate was above that, at 7.05 percent.
At the average rate today for a jumbo loan, you’ll pay a combined $666.65 per month in principal and interest for every $100,000 you borrow. That represents a decline of $3.36 over what it would have been last week.
Refinance rates
30-year fixed-rate refinance declines, -0.03%
The average 30-year fixed-refinance rate is 7.19 percent, down 3 basis points over the last seven days. A month ago, the average rate on a 30-year fixed refinance was lower, at 7.14 percent.
At the current average rate, you’ll pay $678.11 per month in principal and interest for every $100,000 you borrow. That’s a decline of $2.03 from last week.
Where are mortgage rates heading?
The Federal Reserve has signaled that it intends to cut rates in 2024, depending on inflation and employment data and other factors. The Fed meets again on Jan. 31.
Current average 30-year mortgage rates are slightly below 7 percent as of mid-January. As the year progresses, expect rates to slowly trend downward, says McBride.
“Mortgage rates will spend the bulk of the year in the 6s, with movement below 6 percent confined to the back half of the year,” says McBride.
The rates on 30-year mortgages mostly follow the 10-year treasury, which shifts continuously as economic conditions dictate, while the cost of variable-rate home loans mirror the Fed’s moves. These broader factors influence overall rate movement. The specific rate you’d qualify for is tied to your credit score, loan type and other variables.
What current rates mean for your mortgage
While mortgage rates change daily, it’s unlikely we’ll see rates back at 3 percent any time soon. If you’re shopping for a mortgage now, it might be wise to lock your rate when you find an affordable loan. If your house-hunt is taking longer than anticipated, revisit your budget so you’ll know exactly how much house you can afford at prevailing market rates.
You could save serious money on interest by getting at least three loan offers, according to Freddie Mac research. You don’t have to stick with your bank or credit union, either. There are many types of mortgage lenders, including online-only and local, smaller shops.
“All too often, some [homebuyers] take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming,” says Mark Hamrick, senior economic analyst for Bankrate. “But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”
More on current mortgage rates
Methodology
Bankrate displays two sets of rate averages that are produced from two surveys we conduct: one daily (“overnight averages”) and the other weekly (“Bankrate Monitor averages”).
The rates on this page represent our overnight averages. For these averages, APRs and rates are based on no existing relationship or automatic payments.
Learn more about Bankrate’s rate averages, editorial guidelines and how we make money.
Do you know the return on investment (ROI) of your renovation project?
Some renovations can make your home more valuable. However, other projects may provide very little or no return. If you’re investing in a home renovation in hopes of recouping that money when you sell, it’s important to research and plan ahead before you begin to ensure you’re spending your money wisely.
Home renovation projects of all types are on the rise. In a recent study, 55% of homeowners reported renovating a part of their home in the past year.
But how many of these homeowners will see a return on their investment?
It depends. Getting a full recoup of remodeling costs isn’t very likely. And while smaller DIY projects probably won’t break the bank, homeowners should address whether a project is worth its weight in salt — especially before diving into large-scale remodels.
Keep in mind, though, that you can still potentially increase your home’s equity even if you don’t fully recoup the cost of certain improvements. Equity is the difference between your home’s current market value and the amount you owe on your mortgage. A home upgrade that doesn’t fully pay for itself dollar-for-dollar in terms of increased home value may still boost your home’s overall market value, thereby increasing your equity.
10 Home Improvements That Add Value
A way to determine whether a home improvement makes sense is to look at a project’s cost vs. its value assessment. This resulting renovation-to-resale value assessment number, “cost recouped,” can then be used to rank the financial benefit of comparable projects across the country.
Take a look at these popular home improvement projects and their ROI values. You may be surprised at what tops the list.
HVAC Conversion | Electrification
Job Cost: $17,747
Resale Value: $18,366
Cost Recouped: 103.5%
Garage Door Replacement
Job Cost: $4,302
Resale Value: $4,418
Cost Recouped: 102.7%
Manufactured Stone Veneer
Job Cost: $10,925
Resale Value: $11,177
Cost Recouped: 102.3%
Entry Door Replacement | Steel
Job Cost: $2,214
Resale Value: $2,235
Cost Recouped: 100.9%
Siding Replacement | Vinyl
Job Cost: $16,348
Resale Value: $15,485
Cost Recouped: 94.7%
Siding Replacement | Fiber-Cement
Job Cost: $19,361
Resale Value: $17,129
Cost Recouped: 88.5%
Minor Kitchen Remodel | Midrange
Job Cost: $26,790
Resale Value: $22,963
Cost Recouped: 85.7%
Window Replacement | Vinyl
Job Cost: $20,091
Resale Value: $13,766
Cost Recouped: 68.5%
Bath Remodel | Midrange
Job Cost: $24,606
Resale Value: $16,413
Cost Recouped: 66.7%
Window Replacement | Wood
Job Cost: $24,376
Resale Value: $14,912
Cost Recouped: 61.2%
Source
Pre-Renovation Checklist
Long before you start tearing down walls or ripping up floors, you should consider the following:
Have you budgeted for the renovation costs?
Is the remodel a temporary fix or a long-term lifestyle change?
How long do you plan to live in the home?
Can you afford the renovation without recouping a full or near-full ROI?
How long will the renovation last?
Will the improvements add value to your home equity?
Still unsure if your project is worth the cost? Here’s a more in-depth look at the questions above.
Don’t Guesstimate Your Renovation Budget
No matter how much you try to nail down a renovation budget, there will likely be unforeseen costs along the way. Plan ahead by getting a clear view of how much you can spend.
Talk to contractors, compare their rates and get your priorities in check. It’s easy to spring for granite countertops over laminate when you’re visiting the showroom, but if you need to rewire your electrical system to install the new kitchen appliances later, you might need more funds.
Quick Fix or Lifestyle Upgrade?
While the size of a project is largely dependent on budget, in some cases, a quick-fix repair may cost more money over time than a large-scale renovation that solves a major headache.
For example, if mold is growing on your first-floor ceiling due to a leak in an upstairs shower, you may consider replacing the grout as a short-term, low-cost solution. However, you should have the house inspected to determine the best way to address the issue — mold can be a more extensive problem than first meets the eye. Depending on the damage, you may need to completely redo the tile, drain and pipes and you could require professional mold remediation.
Getting professional advice now will help you pass an inspection later in case you decide to sell.
Will You Stay — A Forever Home or Prepping for a Sale?
If you’re preparing to put your home on the market, ensure your renovations appeal to buyers. One of the biggest misconceptions among homeowners is that major home improvements equate to more money in the final sale. That’s not always the case. If you’re planning to stay in your home for several years, make sure you can realistically live with the changes long term.
Research Your Project’s Regional ROI
It’s essential to consider the value of renovations in your region — not just on a national scale. In colder climates, energy efficiency projects may reap more value, while a swimming pool may dissuade buyers. On the other hand, in warmer regions, a pool may attract buyers to your home.
Adding additional rooms or square footage is one of the most impactful ways to increase your home’s value. An appraiser will be able to compare your home to those in your area who fall into the larger square footage category. Additional space can be used as an office, playroom or entertainment area, making it a worthwhile investment.
Considerations of Living Onsite While Renovating
Home improvement projects can get stressful and can’t always be completed over the weekend. Be sure to plan a realistic project timeline and make arrangements to get through the renovation chaos. With major renovations, it’s often pragmatic to set aside funds. If you’ll have to spend several hours away from home while the contractors complete their work, you may need to stay overnight in a hotel or plan a fun day out.
Also, be aware that when renovating or doing major construction on your home, you will be unable to refinance during that time. This is because an appraisal is typically required, and the home must be in safe and functional condition.
Increased Home Equity Benefits
Sometimes, home improvement projects solely benefit you — and that’s OK! Increasing your home’s value has several benefits. If you’re staying in your home, you might be able to apply the equity to secure a home equity line of credit (HELOC), a home equity loan (HEL) or even a cash-out refinance to help pay off debts, pay for college tuition or purchase a new car, for example.
If your home is on the market, your home improvements could help it sell faster and for more money. However, keep in mind that if you want to attract investors, most require a home listing to be off the market for a certain period of time before they can consider investing in it. Typically, this time ranges anywhere from six months to a year, even if the home was only listed on the market for one day.
Remodeling Mistakes to Avoid
When it comes to making home improvements, too often, homeowners rely on instinct rather than research to decide which projects to embark on. So, while converting the garage to an extra bedroom might seem like a good idea, the inconvenience of street parking isn’t likely to entice a potential homebuyer anytime soon.
Some other remodeling mistakes to avoid:
Underestimating project costs. It’s important to fully understand your project’s size, scope and complexity. Consider the supplies, skilled professionals, inspections and permits that may be required, and any systems, such as electrical or plumbing, that will be affected and impact your costs.
Not anticipating issues. Things don’t always go according to plan. Ensure you have a buffer of funds to manage unexpected issues that may arise.
Having an unrealistic timeline. Major gut renovations can take months to design and build, which leads to higher labor costs. Can you live in your home through the renovation if it takes longer than anticipated? Do you have a contingency plan?
Not doing your research. If you want to enhance your home’s resale value, do your homework to ensure your upgrades will help you maximize your investment.
Don’t Rely on Reality TV for Ideas
Did you know that one of the most valuable home investments is adding fiberglass insulation to a home’s attic?
Probably not. But watching contractors stuff the ceiling with insulation on popular home improvement shows just isn’t as interesting as watching designers discuss the layout of a total kitchen overhaul, complete with high-end fixtures, granite countertops and top-of-the-line commercial-grade appliances.
An overly pricey, sophisticated kitchen may backfire once a home is back on the market. A minor kitchen remodel, on the other hand, such as painting the cupboards or replacing laminate flooring with ceramic tiling, not only provides a more cost-effective solution for homeowners, but may also yield a higher return on their investment. Painting kitchen cabinets is an inexpensive cost to a homeowner because they can be painted on-site instead of at a warehouse and then shipped.
Make Your Home Improvement Plan
Whether you’re a first-time homebuyer with a growing family or a near-retiree looking to sell and downsize, it’s important to understand which home improvement projects make the most sense for you.
If you’re renovating with ROI in mind, consider how prospective homebuyers will view your interior, exterior, outdoor space and landscaping. Focus on projects that improve your home’s functionality and appeal to a wide range of buyers. And remember, even relatively small renovations can still increase your home’s value and equity.
Talk to a real estate agent to get their guidance on which projects may have the biggest impact on your home’s value. If you’re ready to begin your next exciting remodeling project, inquire about a home equity loan that turns your current home equity into cash. Reach out to a Pennymac Loan Expert and find the option that’s right for you.
The 1980s, as a decade, were all about excess. Puffy shoulder pads, heavy makeup, and big hair dominated the fashion and beauty world, and bold colors, prints, and textures took over the home décor space. Possibly the most popular color during this era, however, was mauve, a distinctive dusty, pale pink purple that washed over everything from bedding to carpets. This color gave rooms a distinctly feminine flair and was often paired with other colors in the same muted pastel family, like pale blue, mint green, and light yellow.
National mortgage rates were mostly higher versus last week, according to rate data compiled by Bankrate. Rates for 30-year fixed, 15-year fixed and jumbo mortgages moved higher, while 5/1 ARM rates stayed flat.
Mortgage rates could gradually come down this year, according to Greg McBride, CFA, Bankrate chief financial analyst. Rates began falling in the latter part of 2023 as inflation cooled and the Federal Reserve opted not to raise rates further. The central bank now expects to cut rates in 2024 — a reversal that would touch all corners of the economy, including on the 10-year Treasury, the main driver of fixed mortgage rates.
“The 10-year Treasury yield that serves as a baseline for fixed mortgage rates will have a bouncy journey lower, moving back above 4 percent early in 2024 but trending lower as inflation cools and the Fed gets closer to cutting rates,” says McBride. “For mortgage rates, that portends a general downtrend — albeit with fits and starts — in 2024.”
Rates last updated January 5, 2024.
These rates are marketplace averages based on the assumptions here. Actual rates listed on-site may vary. This story has been reviewed by Suzanne De Vita. All rate data accurate as of Friday, January 5th, 2024 at 7:30 a.m.
30-year mortgage increases, +0.14%
The average rate for a 30-year fixed mortgage for today is 7.09 percent, an increase of 14 basis points since the same time last week. A month ago, the average rate on a 30-year fixed mortgage was higher, at 7.45 percent.
At the current average rate, you’ll pay a combined $671.36 per month in principal and interest for every $100,000 you borrow. That’s up $9.41 from what it would have been last week.
The 30-year mortgage is the most popular home loan, and it has a number of advantages. Among them:
Lower monthly payment: Compared to a shorter term, such as 15 years, the 30-year mortgage offers lower, more affordable payments spread over time.
Stability: With a 30-year fixed mortgage, you lock in a set principal and interest payment, making it easier to plan your housing expenses for the long term. Keep in mind: Your monthly housing payment can still change if your homeowners insurance premiums and property taxes go up or, less likely, down.
Buying power: With lower payments, you might qualify for a larger loan amountor a more expensive home.
Flexibility: Lower monthly payments can free up some of your monthly budget for other goals, like building an emergency fund, contributing to retirement or college tuition, or saving for home repairs and maintenance.
Read more: What is a fixed-rate mortgage and how does it work?
15-year mortgage rate advances, +0.12%
The average 15-year fixed-mortgage rate is 6.47 percent, up 12 basis points over the last week.
Monthly payments on a 15-year fixed mortgage at that rate will cost approximately $869 per $100,000 borrowed. The bigger payment may be a little harder to find room for in your monthly budget than a 30-year mortgage payment, but it comes with some big advantages: You’ll come out several thousand dollars ahead over the life of the loan in total interest paid and build equity much faster.
5/1 ARM goes unchanged
The average rate on a 5/1 ARM is 6.40 percent, unchanged over the last 7 days.
Adjustable-rate mortgages, or ARMs, are home loans that come with a floating interest rate. In other words, the interest rate will change at regular intervals, unlike fixed-rate mortgages. These loan types are best for those who expect to sell or refinance before the first or second adjustment. Rates could be considerably higher when the loan first adjusts, and thereafter.
While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.
Monthly payments on a 5/1 ARM at 6.40 percent would cost about $626 for each $100,000 borrowed over the initial five years, but could increase by hundreds of dollars afterward, depending on the loan’s terms.
Current jumbo mortgage rate moves higher, +0.14%
The average jumbo mortgage rate is 7.14 percent, an increase of 14 basis points since the same time last week. This time a month ago, jumbo mortgages’ average rate was above that, at 7.53 percent.
At the average rate today for a jumbo loan, you’ll pay a combined $674.73 per month in principal and interest for every $100,000 you borrow. That’s an increase of $9.43 over what you would have paid last week.
Mortgage refinance rates
30-year mortgage refinance rate increases, +0.14%
The average 30-year fixed-refinance rate is 7.23 percent, up 14 basis points compared with a week ago. A month ago, the average rate on a 30-year fixed refinance was higher, at 7.57 percent.
At the current average rate, you’ll pay $680.82 per month in principal and interest for every $100,000 you borrow. Compared with last week, that’s $9.46 higher.
Where are mortgage rates going?
At its December meeting, the Federal Reserve signaled it was done raising interest rates and would begin cuts in 2024. In response, mortgage rates dropped to under 7 percent, and remain there as of early January.
This dynamic could hold throughout the year, says McBride.
“Mortgage rates will spend the bulk of the year in the 6s, with movement below 6 percent confined to the back half of the year,” says McBride.
The rates on 30-year mortgages mostly follow the 10-year treasury, which shifts continuously as economic conditions dictate, while the cost of variable-rate home loans mirror the Fed’s moves. These broader factors influence overall rate movement. Your rate might be higher or lower than what trends show, depending on your credit score and other factors.
What today’s rates mean for you and your mortgage
While mortgage rates are notoriously volatile, there is some consensus that we won’t see rates back at 3 percent. If you’re shopping for a mortgage now, it might be wise to lock your rate when you find an affordable loan. If your house-hunt is taking longer than anticipated, revisit your budget so you’ll know exactly how much house you can afford at prevailing market rates.
Keep in mind: You could save thousands over the life of your mortgage by getting at least three loan offers, according to Freddie Mac research. You don’t have to stick with your bank or credit union, either. There are many types of mortgage lenders, including online-only and local, smaller shops.
“All too often, some [homebuyers] take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming,” says Mark Hamrick, senior economic analyst for Bankrate. “But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”
More on current mortgage rates
Methodology
Bankrate displays two sets of rate averages that are produced from two surveys we conduct: one daily (“overnight averages”) and the other weekly (“Bankrate Monitor averages”).
The rates on this page represent our overnight averages. For these averages, APRs and rates are based on no existing relationship or automatic payments.
Learn more about Bankrate’s rate averages, editorial guidelines and how we make money.
A motorized version of a Murphy bed makes raising and lowering the piece of furniture much easier thanks to a push button that puts the bed silently in place, as well as hides it again, in under 15 seconds.
Created by Odin Visser for Moooi, the contemporary, versatile suspension light is playful yet elegant, simple in functionality but visually intriguing.
The clock’s gently curved aluminum design, paired with its minimalist clock face typography, results in an iconic timepiece. It’s now available in four new colorways.
This series includes representations of some of the architect’s original masterpieces in the form of lighting, honing in on Wright’s refined style that highlights the relationships between natural and manmade elements.
The Toneoptic rpm isn’t your ordinary vinyl storage solution – it cleverly marries design and functionality to elevate your music listening experience.
Celebrating their 80th anniversary, the brand released a selection of home goods and furnishings from their archives with a colorful, contemporary refresh.
Melt gets you organized with four products that are 3D printed using bio-based filaments made from recycled food packaging waste with other compostable or renewable materials.
The IKEA research and design lab created Couch in an Envelope as a way to challenge traditional design and make it more sustainable, adaptable, and easy to transport.
Designer Sabine Marcelis’ 20-piece VARMBLIXT collection is a collaboration with IKEA that includes sculptural lighting objects, serveware, rugs, and more.
And the most popular Home Furnishings post of 2023 is…
IKEA had an amazing year of design and collaborations, with four posts included here acting as proof. This limited-edition series of 26 products, brings together Nordic design and self-care rituals. From furniture to glassware to textiles, vibrant patterns reflect nature back at you.
Kelly Beall is Director of Branded Content at Design Milk. The Pittsburgh-based writer and designer has had a deep love of art and design for as long as she can remember, from Fashion Plates to MoMA and far beyond. When not searching out the visual arts, she’s likely sharing her favorite finds with others. Kelly can also be found tracking down new music, teaching herself to play the ukulele, or on the couch with her three pets – Bebe, Rainey, and Remy. Find her @designcrush on social.
*This article was sponsored by Barndominium Life, the #1 media brand covering the barndominium space.
Back in 2016, Chip and Joanna Gaines transformed a horse barn into a modern-day living space for the Meek family in what later became known as one of the greatest Fixer Upper episodes of all time.
And while that particular renovation drew scores of HGTV fans to watch the Season 3 episode of the popular home renovation show, the barn conversion also had a lasting impact on the house design landscape, catapulting barndominiums into the mainstream — and making them one of the most hip, desirable, and fun options for dwellings to emerge in recent years.
Loved for their distinctive charm, low building costs, and versatility, these barn-like structures converted for residential use cater to a wide range of lifestyles, from those seeking a lovely country retreat to individuals looking for a contemporary urban oasis with a hint of rustic charm.
Barndominiums are having a moment
The ability to customize the living space, combined with the spacious floorplans, appeals to a diverse demographic, making barndominiums a viable option for families, professionals, and retirees alike.
And with the increasingly higher costs of housing, coupled with the never-ending rise in interest rates of the past couple of years, barndominiums have stepped in to provide a much-needed alternative to traditional homes.
In fact, Google Trends shows an explosion of web searches from users interested in learning more about this alternative housing option. Starting in mid-2020, Google searches for the term “barndominium” have shot up, and have been on a roll ever since.
Where to learn about the barndo life
Naturally, the rise in popularity brought about scores of websites and blogs catering to this growing interest and teaching people how to design, build, and decorate their own barn-like structures.
But the leader in the space is the aptly named BarndominiumLife.com, a comprehensive website dedicated to celebrating the barndo lifestyle.
As the #1 media brand covering the barndominium space, the website offers a wealth of information, presented in various formats — like blog posts, videos, instructional guides, floor plans, and more — to help their readers build their dream barn-like home.
Started by a building expert with a burning passion for barndominiums, Barndominium Life has attracted a talented team of writers, designers, and contributors who willingly share their knowledge with readers across the U.S.
Their goal: to help address the pressing issue of housing availability — and to educate and accelerate the rate at which barndominiums are built.
And they’re offering all the tools one might need to get their structure off the ground, from cost overviews to design and interior inspiration and state guides (that provide relevant local resources based on your location).
They even provide granular advice to address specific pain points for barndominium owners that we didn’t even know existed, like tips on what the best cell phone signal boosters are for metal buildings.
Seeing increasing interest from people looking for housing alternatives due to the current state of the market, they expanded their services to also include pre-made building plans.
Buy barndominium plans and build your own
Starting 2021, BarndominiumLife upped the value they offer their readers by adding ready-made barndominium house plans.
With budget-friendly prices, BarndominiumPlans has a wealth of stock house plans covering the most popular barndo designs and configured for several layouts and square footage.
Shortening the process from the idea level to execution, each one of the site’s pre-made building plans offer the perfect starting point for people looking to adopt the barndominium lifestyle.
And they’ll even help their clients customize the designs with the help of their skilled designers.
BarndominiumPlan’s lead designer, Christy, holds a degree in Architecture and Interior Design and specializes in designing spaces that are both cool and functional, mixing old-fashioned charm with modern style to spectacular results.
Buying a ready-made barndominium plan costs $1,550, and they also run promotions from time to time — so make sure to stay tuned if you’re looking for a discounted rate.
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