Living In Charlottesville and more

The article in  Business Week  does grab your attention.... but is it  true?  "If you don't buy a home now, You're either Stupid or Broke".  Sometimes don't you  wish you could say this to a few Buyers.  I don't think they understand what a "holiday gift" this really is.  Most econmic forecaster are stating that interest rates will begin to climb after the first of the year and will be 1% to 2% higher in the next 12 months.No, I really don't believe my clients are stupid... but I  want to make sure they have have really looked at all the factors. 

Interest rates are at a 40 year low. 

The tax credit for first time home buyers and for existing home owners is substantial. ($8000 or $6500)

Inventories are falling.

5 straight months of increased sales.

Here is one example that illustrates increasing interest rates and how they could affect your payment.  Look at  a 30 year mortgage of $300,000 at today's rate 4.875%. The PI payment is $1587.  If rates climb 2% then that  PI payment CLIMBS to $1970.  WOW!  Almost $400 a month increase.

Maybe it would be nicer said..."If you don't buy a home now, You're either Broke or Uninformed".