NOT LISTEDSANTA MONICA CONDO - SUNSET PARK2 BEDROOM / 2 BATH / 1400 SQ FTFOR LEASE --$4500 / MOS Quiet Unit in Great complex. Close to Pool and Spa this 2BR 1.75BA Condo has a large living room
INTEREST RATES EXPECTED TO HIT OVER 5 PCT NEXT YEAR PURCHASING POWER DROPS RADICALLY
Last week the mortgage rates ticked down to close to 4% , not the all time lows we have seen a year or so ago but still extremely low. On top of that Jumbo loans , I have written about in a previous blog, are near or even below conforming loans, a very rare happening.
What is conforming or jumbo loans? A very simple answer, this holds true in most of the country, conforming loan limits for a single family home is $417,000 the Fed backed FHA has determined that the higher cost areas of the country should raise conforming and they have two stages one at $625,500 and one at $721,050. In the past these higher limits interest rates did go up with Jumbo (over conforming) being the highest. Now this phenomenon where Jumbos are close to conforming will not last. Today I believe cash is not king get your 1.2m loan at 4.10% and use your cash for better returns.
Ok, where am I going with this... read this article Interest Rates Near 4% Expected to Go to over 5% next Year
This along with many other article and talking heads are predicting over 5% interest next year. What this means to you the home buyer;
$500k mortgage @4.0% -- P & I = $2387/mos
$500k mortgage @5.2% -- P & I = $2714/mos
$550k mortgage @4.0% -- P & I = $2625 /mos
As you can see it is not about house prices going up and down as much as the interest rates... watch and be aware of interest rates more then home prices
DBA "West Los Angeles Real Estate Group" ....