Rate relief in Florida
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New construction homes offered a larger share of mortgage buydowns compared to existing homes last year, according to a recent report from Realtor.com.
Why it matters: Buydowns, lowering interest rates upfront, can knock 1 to 3 percentage points off your mortgage rate.
By the numbers: Home listings in Florida last year included an offer of a mortgage buydown for about 4% of new construction and about 1% of existing homes, per Realtor.com.
How it works: Sometimes builders have in-house or affiliate financiers that allow them to offer incentives, like buydowns, to prospective new-home buyers, Realtor.com's Joel Berner says.
- This tactic isn't new, but it's been popular in recent years due to elevated mortgage rates.
Yes, but: You don't have to buy new to score a buydown. A buyer or seller of an existing home can buy down the mortgage rate, too, Berner says.
What's next: The buydown trends are slowing down. "But with mortgage rates persistently hanging around 7%, they may maintain some popularity," Berner says.