Mortgages Rates And Their Impact On Real Estate
Realtors® are constantly receiving information from their circle of contacts on topics related to real estate. Just the other day I received an article from one of my mortgage agent contacts, Paul Meridith, that I thought might interest my readers.
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In commenting on current mortgage rates Paul talks about the real estate market and his take on how the rates affect the market. Mortgages Rates Recently the news about rising rates talks about the Bank of Canada raising prime by 1/2% since this spring. Paul feels that many people believe when the prime rate goes up the increase also applies to all mortgage rates. In fact it is just the variable rate mortgages that have been affected. While this may seem like bad news the prime rate is just one of the components that make up the variable rate. Paul tells us that in fact the current variable rates are actually lower than they were last summer thanks to a discount that far exceeds the recent hikes in the prime rate. Last summer the variable rate was just over prime compared to the prime less .065% mentioned in his newsletter or the prime less .075% with a three year term variable rate mortgage. And Their Impact On Real Estate Paul considers now an excellent time to be out buying real estate. He feels home buyers should be jumping all over these rates as the buyer competition has settled down in most areas.
Paul Meredith is a Mortgage Agent
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Kathy Clulow Sales Representative RE/MAX All-Stars Realty Inc.. Brokerage 905.852.6143
Each office independently owned and operated Not intended to solicit clients already under contract
Kathy - Excellent information on the impact of mortgage rates on real estate.
John - this mornings news about mtg rate reductions adds weight in his closing words
Kathy,
Recently, rates at the longer end have come down. In fact, this is stil an historically low period in the last 50 years.
Brian
Kathy: When rates start to go up, and they will eventually, everyone will be upset and buying will be halted for awhile. I understand your post is more about the mechanics and the "mechanics are the mechanics", but I am dreading the rising rates when it does happen....especially if someone is playing the "Do I Lock Now Or Wait", game!
Brian - only a few of us have been around long enough to remember the 19% to 21% plus first mortgages of the early 1980's. ..... To us todays rates are a gift of almost free money
In September of 1981 the Average Five Year First Mortgage Rate Peaked at 21.46%%
Jane - each of us have our own criteria that we use to make the decision to buy ..... unfortunately many simply follow the latest news item with out doing any real research on rates and the effect the "mechanics" have on the type of loan they are thinking about.