Interest Rates + Housing Availability = Affordability of the Home You Really Want
If you have been watching the housing market for the past few months, there is no doubt in your mind that there aren't many houses available, the prices are fluctuating and so are interest rates. Just like back in the early 2000s, houses that came on the market didn't last long. Interest rates were reasonable and then they plummeted to around 3%...and stayed there for a while. But now, they are up around 6-7% and most people don't want to give up their 3% rate. I don't blame them. Every couple of months the Federal Open Market Committee, commonly referred to as "The Fed" meets. So? Why should I care? Because "The Fed" looks at inflation and decides whether to raise or drop interest rates. Lower rates = more affordable housing. Lower rates = people willing to sell their homes and relocate = more homes on the market. For example: A $400,000 home loan at 3% interest has a principle and interest payment of $1,686.42 for 30 years. That same $40