This week I heard from several agents and mortgage brokers in McKinney that clients had backed away from home searches in our area because of the rumors that the government is going to reduce mortgage rates to 4.5%. We have seen some purchases of foreclosure properties by clients with cash. For the first time in my memory, having cash for a purchase seems to be impacting seller attitudes. Even banks seem to be responding to cash offers. The folks who have stepped to the sidelines are forgetting that mortgage rates TODAY are at 50 year lows. They also neglect to calculate that the difference in monthly payment between a loan at 5.2% and one at 4.5% is minimal. It probably less than half of their monthly Starbuck's bill. If I needed a house I would be actively in the market today. It is not possible to time any market and the housing market is no exception. There are tremendous bargains out there. When I calculate replacement costs for some of the deals I see, I know that there will not be a better time to buy than now. Looking back on this buyers will be kicking themselves for not acting.
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