Just because real estate is overpriced does not mean rates are too high.
@ 16% 1981.
Yeaaaa. No.
Stagflation
So glad our kid bought into a house @ 3.125% 30-year fixed in November 2021. Those rates may not come back for quite some time. Certainly not before a lot more damage is done to the country.
My parents were real estate agents in the ‘eighties, ‘nineties and ‘oughts.
Mom would really get excited when there was “first time home buyers” money coming down the chute.
Years later I realized she was talking about the infamous “subprime loans.”
Meh. I bought my first house in 1984 when I was 24. I had to finance an ARM at 11%. Before the 5th year balloon payment came due. I was lucky by working my ass off, to qualify for an 8% fixed loan.
Just because real estate is overpriced does not mean rates are too high.
They voted for the people who brought this on them.
And as others have already pointed out, aint seen nothin yet.
79-85 had mortgage rates more then twice what they are now. Inflation keeps up, we could get back there. Powell will have to do it...if the Rats running the country dont turn around on the insane crap they did that put us here.
All Trump has to do in that case is what Reagan did in 1980: ask everyone if they’re better off now then they were 4 years ago.
These sub-3% interest rates are a newer phenomenon. When we bought our first home in the mid-90s our VA interest rate was closer to 8%. That was only slightly higher than the going non-VA rate. If anything, rates are back to where they used to be.
The larger problem is that young buyers have a sense of entitlement and would rather have their home paid for by dad and mom — maybe by a spare room in their parents house…
The American Dream is not within the grasp of many young people.
And I don’t think we’re bouncing back from this one. Yes, interest rates were higher in 1981, but Reagan came in and it was Morning In America again in the 80s. I don’t see that happening easily now in the 21st century.
And it’s not just young, first time home-buyers. Those folks may be the canary in the coal mine — but I think we are all still on track for a future where “you will own nothing, and you will be happy”. That one is going to come for us all eventually.
Wasn’t too good in the late 70s into the early 80s either when Carter was in the White House, for the same reasons.
My wife and I have always lived with the philosophy to live below our means, give for the gospel's sake, give to charities and save for retirement. When I see the current fixed mortgage rate is 7%, I think it's not bad compared to the 14.5% rate we had in 1981.
Every generation has its challenges. My advice for any young person would be to invite Christ into your life and when it comes to finances, seek and apply Christian wisdom.
I am going to Buy the Farm..
Today’s home-buying KIDS are a bunch of whiny cry babies. My wife and I bought our first home together in 1979. We felt lucky to have a fixed rate 30-year mortgage at 9.5%
And when we walked 2 miles to the market it was uphill BOTH WAYS!
Fortunately their mortgage will only be painful for a short time. In a decade, they will be able to pay it off for the price of a loaf of bread. They can use $1,000,000 bills with Biden’s face on them. Sadly, they will need another loan to buy their groceries.
Rob and Kelsey Scott with cat child bought their first home in November
caption of picture.
My siblings and I have put my late mother’s house on the market. We reduced the price by $10,000 the first of March. We have no serious parties interested even though it is on over 9 acres, in the country, surrounding by corn and soybean field, and has no HOA. It also has a shop out back with a concrete floor. It’s in a rural county in a red state with practically no crime, and decent schools. Yes, the house is small and only three bedrooms, but new first-time home buyers do not want a “starter” home. They want the 3000 foot brand new home with a full basement. And, they can’t afford the payments on what they want and demand. The house appraises for a decent price, but no one seems to be able afford it.
The interest rates will probably go down at some point, and then you refinance.
A good friend had two of his four kids buy homes in the last say two-three years. I don’t know if he helped them out, I don’t consider it my business. But I noted to him that getting his kids into mortgages with a “2” handle was likely one of the best financial moves they’ll ever make, and he agreed.
Bkmk