Last week we took a look at how high inventory is working in our market place. More homes mean better selection, and better pricing for buyers. Coupled with the new interest rates this seems to be a “perfect storm” for people who have been considering buying a home or investment property.
If you have been on the fence about buying a home soon, now may be your time to commit. Mortgage rates are now below 4% for the first time in almost 2 years. If you hadn’t qualified for the amount you wanted to spend on a home this new rate is great news. A lower rate means you can afford a higher loan amount at the same payment. And the home you were hoping for may have had a price adjustment in your favor as well!
Take a look at the chart below and see what a difference one point can make.
Look at the difference between the purchase price with a change of 1% point. If your maximum budget was $521,250 your new max is now $465,281 with a 1% increase, a loss of almost $56,000. The monthly payment difference would be close to $250 a month. This is a completely different budget and different house.
As we approach the 4th quarter of 2014 interest look to hold at lows around 4%. Take a look at your situation and goals. If you have a desire to be a homeowner or investor this is the time. Lets get to work and make your goals a reality.
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