It’s not very nice to profit from your neighbors’ troubles. Sometimes, though, there’s simply nothing you can do to stop it.
At the beginning of the summer, as I’m sure you have heard, the UK voted to leave the EU. This became known as “Brexit,” and it has created heaps of uncertainty and worry for our neighbors across the Atlantic.
Here in the U.S., though, Brexit has been nothing but good news for the real estate market. Because of Brexit, investors all over the world wanted a safer place to invest, and this pushed already low mortgage rates down even further to almost unseen lows.
In fact, we are now in the middle of the second-longest run of cheap mortgage rates in history. The 30-year fixed rate mortgage is 3.46%; this is only a few points above its all-time low of 3.31%.
What does this mean for you?
First, if you are looking to buy a home, now is an unusually good time to do so because these low rates mean you will be paying less. As an example, taking out a 30-year, $250,000 mortgage today versus a year ago (when the rate was 3.91%) would mean that you would save more than $25,000 over the lifetime of the loan.
The other way to look at it is that at today’s rates, you can afford a more luxurious home without paying more. For example, if you were to take out a 30-year mortgage, you could now afford $15,000 more for a home than a year ago while keeping the same monthly payments.
Clearly, this is a great opportunity. “Here in the U.S., Brexit has been nothing but good news for mrtgage rates.” Now, if you are looking to sell rather than buy, these low rates also benefit you big time. The more the mortgage rates drop, the more buyers there are, and the greater the demand is for homes.
This healthy demand keeps up the price of your home and ensures your home will get sold quickly. Not surprisingly, pending home sales are up by 1.3% this summer and are now at the second-highest level in over a decade.
As you can imagine, these ultra-low mortgage rates won’t last forever and will rise sooner or later.
If you are looking to take advantage of this unique situation while it lasts, give me a call or send me an email. I’m always here to help.