Interest rates directly affect the price of the home a buyer can afford. With interest rates continuing to hold at all time lows, and the predictions of higher rates in 2014 looming, now may be the perfect time to jump off the fence and take advantage of this increased buying power.
How significant is the buying power of lower rates? Take the example of a buyer qualified to purchase a home for $200,000 at 4.5%. If the interest rate increases to 5%, the same buyer only qualifies for approximately $188,000. When rates jump to 5.5%, the buying power drops to approximately $178,000. The difference is much more significant than most people think!
With interest rates over the last 30 years averaging close to 9%, and rates as of October 30th, 2013 at 4.125%, why wait? NOW is the time to make your move!!!!