Do Mortgage Interest Rates Matter? And…State Of The Real Estate Market June 2014
YES!!! Almost as much as the price of the home itself because the interest rate that you are being charged directly impacts the affordability of the home you want to own.
Here’s an example:
If the home that you are after is priced at $250,000 and you offer on the property today, your interest rate is likely to be approx 4%. Your principal and interest payment would be $1,193.54.
If you wait and interest rates go up even a half of a percent, that same purchase price will cost you $1,266.71. This is a difference of $73.17 a month!! That’s the cost of a week’s worth of groceries for some people and that’s all due to a 1/2 of a percent increase. Now, imagine what it would be if rates went up to 5% or 6%, which they have been in the not so distant past. You are talking $1, 342.05 and $1,498.88 respectively for that same $250k home.
What happens when you wait and the prices go up AND the interest rates go up? You will likely be buying much less house for the same money.
At this time, interest rates are very low and pricing seems to be somewhat stable. This is the busiest time of year though and we anticipate that to change on a dime especially since our listing inventory indicates that we are in a sellers market.
Advice to Buyers: Get your home NOW. Waiting will cost you MONEY. Advice to Sellers: You still need to be the prettiest or the least expensive home on the block to have the most activity at this very moment. Make sure you are using every trick in the book to accomplish this including an attractive marketing package. If you don’t know what that means, call us!
| New Listings | Active Listings | Sold Listings | Months Inventory | |
| May/2014 | 9,809 | 29,284 | 7,448 | 3.93 |
| Apr/2014 | 10,306 | 29,250 | 7,664 | 3.82 |
| Mar/2014 | 10,863 | 29,386 | 6,700 | 4.39 |
| Feb/2014 | 9,908 | 28,809 | 5,500 | 5.24 |
| Jan/2014 | 11,117 | 27,072 | 4,821 | 5.62 |
| Dec/2013 | 6,271 | 26,575 | 5,832 | 4.56 |