30-Year Rates Hit Record Lows
It’s almost unbelievable, but it’s true. As of November 2011, Mortgage rates are at all time lows across the board. When I read this article earlier this morning, I was aware of the fact that rates have been low for a while, but sometimes seeing it on paper (or a screen) can have an additional impact.
In an online article by the Associated Press, posted on Yahoo Finance, the writer describes the historic low rates in the mortgage and home markets (30-year fixed @ 4.00%, 15-year fixed at 3.31%, and a 5/1 ARM @ 2.96%), and the Fed’s intentions of leaving the Fed Funds Rate at near zero. In addition, they are planning to shift more money into longer-term Treasurys, which pushes mortgage rates lower.
I did some quick math and ran a couple of scenarios on what that means for people buying Durango real estate, primarily based upon our median In-town home prices. It’s pretty remarkable:
In an apples to apples comparison, if you purchased a home in 2007 when 30 year fixed rates were hovering around 6 percent, and that home you bought for $375,000 with 20% down ($75,000), your total principal and interest payments over the entire term would be roughly $647,514. That same home (at hypothetically the same price today), with rates at 4 percent would cost roughly $515,608 over the full term. This is an astounding difference. Couple this with the fact that Durango real estate prices are down from the peak in 2007, and it seems like there is good value on a number of levels in buying these days.
For an accurate quote on rates for your particular situation, please visit our preferred lender list under the Financing section of our Buyer Agency page, and contact them today to get stated.