Interest Rate Changes Can Be Costly.

Interest Rate Changes Can Be Costly. I was recently sitting down with a client and we were strategizing about different scenarios that could help them get the most amount of home for their money. As I mentioned the other day in this blog, interest rates recently took a surprising drop. So we calculated how much money these buyers would save or how much it would cost them if rates go back up again. For a $500,000 mortgage at 4.875% (30 year fixed), their monthly mortgage would be $2,646. If the rate goes up to 5.875%, their monthly payment would go up to $2,958. That one percentage point in interest rate would cost/save them 12% on their monthly mortgage. With the amount of money the Fed has pumped into the economy, I would not be surprised to see 6.25% mortgage rates within 12 months to head off runaway inflation (just my opinion). Let’s look at what that would do to this buyer’s monthly payment. It would cost them $3,079 a month. That’s a 16% increase from today. We know we’ve already hit bottom in terms of prices in this area. Here’s my point. Some buyers are still waiting to buy. From this point forward, I believe waiting will come with a cost. If you know me at all, you know that I don’t typically go around spreading wild predictions just to cause people to do something I want them to do. Actually, it’s quite the opposite. I feel a sense of obligation to anyone who accepts my advice and I don’t take that level of trust lightly. That’s why I don’t make these kinds of predictions unless I have a factual sense of cause and effect. If there’s someone you know who’s been waiting to buy, please share this with them. . Or if you prefer, I can sit down with them and go through the details. Two years from now they will thank you for it. -Gary Nobile, Realtor (408) 247-4029 http://www.garynobile.com/

Deciphering Today’s Real Estate is on TV Tomorrow

Deciphering Today’s Real Estate is on TV Tomorrow. Saturday September 5th at 5:30 p.m., I will be interviewed on a public service TV station for their Spotlight on Real Estate segment. It will air on Comcast Channel 15 in San Jose and Campbell. It will also be streamed from www.creatvsj.org (log in early in case you need to download software to see it). I will asked to discuss today’s real estate market conditions along with a brief two year history of real estate in Silicon Valley. The segment I’m featured in is at the beginning of the program and will last about 10 minutes. I’ve prepared a nice graphic for those of you who are more visual in nature to help make it easier to understand today’s market. Hope you enjoy the program and I’d be happy to answer any follow up questions you may have about the information presented. -Gary Nobile, Realtor (408) 247-4029 www.GaryNobile.com

Mortgage Rates Drop

Mortgage Rates Drop. At our weekly sales meetings, we cover various topics. One of them is interest rates. While most have predicted that interest rates will rise within the next 12 months, we were pleasantly surprised to learn rates had dropped this week. We are again seeing some fixed mortgages in the 4.875% range. Jumbo loans are in the low 6% range. Not coincidentally, we polled agents in the meeting and 12 agents were involved with multiple offers last week. Some deals had 2 offers, some had as many as 15. The number of Pending Sales of single family homes in Santa Clara County is at approximately 2,800 while homes for sale are down again to approximately 2,200. The trend certainly seems to be continuing that there are more buyers than sellers. (408) 247-4029 www.GaryNobile.com