I was talking (on Facebook) with a friend this morning and he was mentioning that someday he would want to own a home of his own in Mililani. I took a quick look at what was available in Mililani and saw that there were many properties in the low $400,000s. A little quick math and I saw that his monthly payment on one of these homes would be around $2,100 INCLUDING taxes, principle and interest. When I first looked at the mortgage calculator, it said the payment would be much higher and then I saw that it had automatically set the interest rate at 6.5%.
The moral of my story is that home prices are low and interest rates are even lower. When you use a Mortgage Calculator to figure out what your payment would be, be sure all of the numbers are correct. In Hawaii, property taxes are among the lowest in the nation. They are about $3.42 per $1,000 of value, so a home that costs $400,000 would be about $1,400 per year. Interest rates are a bit below 5% so make sure you put that percentage into the mortgage calculator. On the mainland, property tax is much higher so the number in that block is probably much higher, CHANGE IT! Don’t scare yourself away from buying a home because you have bad information!