Home For Sale Charleston SC: Perspective On Interest Rates
If you have read my previous posts regarding the condition of the current real estate market, you know that interest rates are expected to rise. Based on various projections, we could see interest rates a full point higher this time next year. Combined with increasing home values, today’s house will cost more a year from now.
As expected, Realtors and lenders are shouting that now is the time to buy, and hurry before it’s too late! But here is something to keep in mind–although rates are rising, they are still historically very low.
Just to illustrate this, let’s look at what the monthly mortgage payment (principal and interest) on a $200,000 home would look like based on the average interest rate from each decade.
Even with a full point increase, a mortgage payment is still lower than where we have been previously–save for the historical lows we experienced over the last few years. But, those days are in the past. As far as just how much rates will increase over the next few years, no one can predict for sure. But, it appears that the Fed isn’t opposed to them returning to higher levels more on par with the historical averages over the last few decades. Here are some interesting quotes to consider:
Interesting to note. One segment of the market that should heed the call to buy sooner rather than later is first time home buyers. If you have thought that you might like to buy a house, but don’t think you can, you seriously need to reconsider.
I’ve already covered the fact that many of today’s younger generation and potential first time home buyers have misconceptions about what it takes to buy a house. A simple call to mortgage lender can help you determine what it will take to purchase a home.
Chances are your credit is sufficient. Chances are it you won’t need as much for a down payment as you think you do. However, if either of those are obstacles, then working with the right real estate agent and the right lender can help you overcome them so you can achieve your dream.
In addition to home prices and interest rates rising, there is something else rising for first time buyers: rent. Here is a look at the rising cost of rent over the last 25 years:
So, for potential buyers sitting on the fence, now is a good time to buy. But, if you don’t buy right now, you won’t have missed the boat. For first time home buyers now is the time to make sure you are in the best position mortgage-wise in order to buy homes for sale Charleston SC.
Even if that doesn’t happen today, you still want to make sure all your ducks are in a row so you can take advantage of favorable conditions when the time is right for you. Just don’t put it off for too long. For more help about buying your first home, be sure to contact me and visit my website here.