Fannie Mae, the National Association of REALTORS, and the Mortgage Bankers Association are all projecting that INTEREST RATES are going to increase this year, reaching around 4% by 2013 year end, or more.
So what does this mean for BUYERS and SELLERS who are waiting?
Very simply, this means the cost of your MORTGAGE PAYMENT, on a monthly basis, will go up. The chart below outlines the additional cost of a MONTHLY PAYMENT should rates reach 4% at the end of the year as compared to where they are today (assuming 3.5%).
But that’s not all to keep in mind.
PRICES ARE RISING, so in addition if you wait you very likely will not only pay more to buy the same home if you bought today, say 5% more (that’s $20,000 0n a $400,000 home), BUT you will also pay more for your mortgage.
And if you are selling, the same principle applies. YES you can wait to get more for your house, BUT you will pay more for a new house AND you will pay more for your mortgage.
Something to think about.
[graphic courtesy of Keeping Matters Current]