Along with constant "bad press", a local newspaper today published an article comparing Real Estate to 50 years ago. Click Here for the article. Many would think wouldn't it be nice to go back to then when housing prices were so much cheaper? Well, the question is . . . were they really all that much cheaperr? Let's take a look back just 20 years . . .
Interest Rates over the last 20 years
So let's compare 20 years ago to today with affordability . . .
- 20 years ago a loan at $150,000 at an interest rate of 12% would cost $1543/month principal and interest
- Today a $150,000 loan at interest rate of 6.31% would cost $949/month principal and interest
- A savings of $594/month.
On top of that, average household income has also risen dramatically over the last 20 years also. So what is the issue of affordability? Spending has obviously increased as well as other costs. But all-in-all . . . it's a great time to buy! Buying a house, yes, is a big deal and it takes budgeting. But it is well worth it. Don't fall into the trap of listening to all the negative press we almost seem to get run over by. Interest rates are still great, there are great selections out there, and don't hesitate to make your dream come true.