There are some financial indicators suggesting rates might come down a little later in the year. The same home today will have a 30% higher monthly payment (PITI) compared to a year ago.
For now, the roughly 150% rise in interest rates over the last 12 months, has caused a 12% average housing price decline along with a leveling off of prices in fuel, goods and food. Hopefully that prompts the federal reserve to stop raising rates.
Interest rates were raised by the federal reserve to slow the inflation caused by the over lowering of interest rates by the federal reserve the previous few years and our 30 trillion debt. See Government Borrowing In Real Time.
It appears they run in 12 to 18 year cycles.
To keep the economy rolling more creative loans will likely be returning. Low or no income qualifying loans, ARMs (adjustable-rate mortgages) that offer a discount for the first few years to help people qualify, 40 year mortgages and even interest only loans, may all come back!. (Just like the good old days of the early 2000’s)
If you have any questions, feel free to call me. Alex Schauffert 707 332 8301
If you’d like to receive updates via email, please join the Real Estate Trends List now and I’ll send you the next update.