Business Week Article
December 8, 2009
by: Marc Roth

Interest rates are at historic lows but cyclical trends suggest they will soon rise. Home buyers may never see such a chance again, writes Marc Roth

Well, you may not be stupid or broke. Maybe you already have a house and you don’t want to move. Or maybe you’re a Trappist monk and have forsworn all earthly possessions. Or whatever. But if you want to buy a house, now is the time, and if you don’t act soon, you will regret it. Here’s why: historically low interest rates.

As of today, the average 30-year fixed-rate loan with no points or fees is around 5%. That is the lowest the rate has been in nearly 40 years. In fact, rates are so well below historic averages that it should make all current and prospective homeowners take notice of this once-in-a-lifetime opportunity.

From 1977 to 1981, a period of only 60 months, the 30-year fixed rate climbed to 18%.They hit 9% for a brief time in 1986 and bounced around 10% to 11% until 1990. For the next 11 years through 2001, the rates slowly ebbed and flowed downward, ranging from 7% to 9%. We’ve since spent the last nine years, until very recently, at 6% to 7%. So you can see why 5% is so remarkable.

So, what can we learn from the historical trends and numbers?

If you are someone who is looking to buy or upgrade in the $350,000-to-$800,000 home price range, and many people out there are, then you’re borrowing $300,000 to $600,000. At 7%, the $300,000 loan will cost just under $150,000 more over the lifetime, and the $600,000 loan an additional $300,000, if rates move up just 2% before you pull the trigger

CLICK HERE TO SEE INTEREST RATES GRAPH IN FULL

What I’m trying to impress upon everyone is that if you are planning on being a homeowner now and/or in the foreseeable future, or if you are looking to move your family into a bigger home, then pay more attention to the interest rates than the price of the home. If you have a steady job, good credit, and the down payment, then you really are being offered the gift of a lifetime.

CLICK HERE TO READ THE BUSINESS WEEK ARTICLE IN FULL

Contact Maui’s EcoBroker Meghan Clair of Coldwell Banker Island Properties Wailea to learn more about the once in a life time Real Estate Opportunities in South Maui! MauiGreenRealtor@Gmail.com

Graph is Copyright © 2009 Mortgage-X.com
Source: www.mortgage-x.com
Reprinted with permission