Interest Rates and Mortgage Payments
Interest rates have been historically low. Below we'll analyze and show how low interest rates can dramatically lower your monthly mortgage payments and help you achieve the goal of home ownership. Spring home buying season is approaching our Boise real estate market. Many potential homebuyers are getting ready to enter the real estate market. If you’re thinking of buying a home or an investment property. The chart below shows how average mortgage rates by decade have impacted the approximate monthly payment of a $200,000 home over time:
Over the last 45 years, mortgage rates have ranged from a high of 18.63% (1981) to a low of 3.31% (2012). While it’s not likely that the average 30-year fixed mortgage rate will return to its record low, the current average rate of 3.45% is pretty close — all to your advantage.”
Low mortgage rates – like they are right now – benefit qualified buyers, saving them a lot of money over time.
It's important to remember, if interest rates go up, this can push many potential homebuyers out of the market. The National Association of Home Builders (NAHB) notes: “Prospective home buyers are also adversely affected when interest rates rise. NAHB’s priced-out estimates show that, depending on the starting rate, a quarter-point increase in the rate of 3.75% on a 30-year fixed rate mortgage can price over 1.3 million U.S. households out of the market for the median-priced new home.”
You certainly don’t want to be priced out of the market this year, and waiting may mean a significant change in your potential mortgage payment should rates start to rise. If your financial situation allows, now may be a great time to lock in at a low mortgage rate to benefit greatly over the lifetime of your loan.
Contact us anytime for more information and free buyer consultation.