The cost of a house is made up of the price AND THE INTEREST RATE they will be paying. Two different pieces of news released yesterday highlight this point.
PRICES
The National Association of Realtors (NAR) released their 4th quarter housing research report. In the release, they reported that home sales rose 15.4% in the 4th quarter over the 3rd quarter. They also showed that prices remained stable during the year:The national median existing single-family price was $170,600 in the fourth quarter, up 0.2 percent from $170,300 in the fourth quarter of 2009.
INTEREST RATES
The Primary Mortgage Market Survey was released by Freddie Mac which showed that the 30 year fixed rate mortgage was at 5.05%. Frank Nothaft, vice president and chief economist of Freddie Mac said:“Long-term bond yields jumped on positive economic data reports, which placed upward pressure on mortgage rates this week…As a result, interest rates on a 30-year fixed-rate mortgage rose to the highest level since the last week in April 2010.”
So prices have remained stable but interest rates have risen dramatically in the last 90 days. What does that mean to a Charleston AFB buyer looking to purchase a home this year?
The price is the same. It just costs more.
By waiting to buy, the buyer has lost:
- $89.44 a month
- $1,073.28 a year
- $32,198.40 over the life of the mortgage
Bottom Line
Even if prices fall another 10% this year, the cost of a home will increase if interest rates go up more than 1%. So now is the time to buy!**Information provided by the KCM Crew via http://www.kcmblog.com/**
Torri Jacobsen, Military Homes of Charleston
Buying or selling a home doesn’t have to be hard, but choosing the right Realtor DOES make a difference. I specialize in making first-time home buying a great experience for military families moving to the Charleston , SC
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