Great Britain voted to leave the European Union which jolted world markets into an erratic frenzy. Fortunately, our US economy is pretty self-sustaining and most experts seem to think the tumultuous impact of the event will be brief and temporary.
However, there seems to be one reaction going on right now that should be of particular interest to home buyers. Since the vote, mortgage interest rates have been trending downward. Today, we're looking at 3.7% for a 30 year fixed. If the recent trend continues - and most expect it to - we'll be at a 3 year low (+/- 3.6%) in a matter of days. Some believe we could be setting a bit of a record pretty soon.
To put this in perspective, in 2002, 30 year fixed interest rates were about 6.5%. By 2010 they'd dropped to 3.6% (the current record low). Today we are approaching that level again and will likely exceed it.
The message is this: MOVE NOW. Really, if you're casually looking for your dream house or waiting for the right moment to make a move, now is the time to get something in escrow. Despite our recent reaction to the Brexit vote, most experts still believe we will hit 4% by year's end. That's just six months away.
The difference in 3.7% and 4% may not seem like much. To give you an idea of the difference in borrowing today versus what we will likely have at year's end, a $400,000 30 year fixed rate mortgage at today's 3.7% rate would require a monthly payment of $1,841. If you were to wait and rates rise as they are expected to 'til year's end (4%), your payment would be $1,910. That's $69 a month more, $828 a year and $24,840 over the life of the loan!
We've been talking about 30 year fixed rate mortgages here, but there are a variety of mortgage instruments out there to fit your own style and need. Fifteen year fixed mortgages are very attractive and there are some adjustable rate programs that start really low. The best way to take advantage of this window of opportunity is to call me. I'm happy to review your situation over the phone or sit down with you to help you map out the best way to proceed. I can be reached at: (805) 379- 3300
Help-U-Sell Conejo Valley is a progressive, full service real estate company saving buyers and sellers thousands in Westlake Village, Thousand Oaks, Oak Park, Camarillo, Oxnard, Simi Valley, Los Angeles and all of the Conejo Valley. You may reach us at (805) 379-3300, or by email to [email protected]. Visit our website: www.helpusellcv.com.