The 30 year conforming interest rate has dropped under 4% to 3.94% for the first time ever. This unprecedented opportunity should spur more buyers to step up and get into a home while locking in a rate that makes borrowing effectively free. With a 3.94% loan, the amount of interest you're paying over 30 years is a fraction of what it would be at 5, 6, or 7% rate available in the last few years.
For buyers, keep in mind that what you're buying is a home as well as an investment. You want to know how people keep making money in this market? They get cheap money to put it in to things that generate more return than the cost of borrowing. Over time, real estate has generated returns well above the current cost of borrowing. That said, each area is unique so talk to your agent.
If rates keep dropping should I wait? You could but you might miss the opportunity to buy the home you want. Buyers are constantly looking for "the next best thing" and wondering if a better home will come along. Well of course it will! But, rates could rise and so could prices. In fact, prices are rising in many markets, especially here in Silicon Valley. Find a home you like and get on board with being a homeowner while rates are this low. It may not last.
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Bryan Robertson, Broker Associate | T: 650.799.9951 | Email: bryan@serenogroup.com | Website: http://www.BryanRobertsonHomes.com |CA License: 01191946 | Sereno Group - Los Altos branch | 369 S. San Antonio Road | Los Altos, CA 94022
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