HONOLULU (KHON2) — Mortgage rates have hit 7% for the first time in two decades, but what does that mean for Hawaii’s real estate market?

KHON2 talked to some experts to learn more about what home buyers need to know.

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Element Mortgage said those who are looking to buy a home in the islands will have to lower their expectations since mortgage rates are at 7%.

“That means that now when they were looking at maybe a $800,000 property, now they’re looking closer to a $600,000 property, and that might not be a single-family home anymore,” said Nicky Cruz, mortgage lender at Element Mortgage.

Locking in to a fixed mortgage at 7% will mean the interest rate will stay the same for the duration of the loan — unless the buyer refinances, pays off or sells their home.

“If you do an adjustable rate,” Cruz said, “let’s say it’s a five one, for five years you’ll have a fixed rate, but then it can adjust based on the cap at that time in the market.”

Adjustable rates could be better for some, Cruz added.

“Especially if maybe this is not your forever home, this is maybe to get your foot in the door, kind of see where things go for the next couple of years, that might be a great option,” she said.

Oahu resident Courtney Reichard recently bought a home in Wahiawa and said the process was not tedious even though inventory was low.

“I wouldn’t say that we really had any trouble, it was just we, you know, wanted a three bedroom,” Reichard said. “I mean, I think we looked at maybe five or six houses until we found the one.”

Amber Ricci with EXP Realty said Hawaii’s strong sellers market is starting to level out and some are thinking outside of the box to buy.

“What I’m seeing with some of my clients is that they are having their parents co-sign or having their siblings co-sign to help back up that they can get a bigger priced mortgage,” Ricci said.

Ricci said some realtors are even offering concessions out of their commission to secure a sale, so it is a good time to buy even though mortgage rates are at a 20-year high.

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“But the great thing about it is that you can always refinance, and I’m telling my clients that need to buy now, just lock in yourself in on this rate, even though it’s high now, you’ re still gonna see growth in the long term and you’re still gonna be able to refinance,” Ricci said.