How Mortgage Rates Affect Your Monthly Payment
Sunday January 12, 2025: With the FED's poised to only reduce interest rate 'base points' two times in 2025, Real Estates TOP analysts and forecasters are stating that Buyer are likely going to see interest rates remain in the 6%'s for the entire year of 2025.
Not a bad thing to those seasoned in real estate, because the average interest rate has always been ~10% since mortgages became a thing, starting back in the 1930's.
During the pandemic newer, less experienced buyers thought 2-3% was the norm, and they got really used to this. But now, many of them still wait some 3 years later for the rate to return, when most of the more experienced buyers of real estate know they had never seen such rates in their 50+ years, and that we will never see those rates again, even if another pandemic reared its ugly head.
As of early January here, rates fluctuate daily, but are currently at about 6.9% for a 30-year conventional Fixed Loan, but we have been getting many into the 5% with the programs our partners offer. We like to continue to work with primarily our banking brokers whom look to make sure our clients receive the absolute lowest loan percentage by having multiple competing banks fight over them.
How Mortgage Rates Affect Your Monthly Mortgage Payment
As you look to make your Move in 2025, the below chart should help you in planning for success! With current interest rates to remain in the 6%'s for all of 2025, that line item estimate is outlined below, but remember that the more money you bring to closing, the lower this estimate, and your mortgage rate will become.
Why Are Seller's Selling When They Currently Have 3%
The main opportunity - Most home seller's that have lived in their homes for the past 6-7 years since right before Covid-19, have made over $300,000 in equity on their homes, which is definitely not the norm.
While many sellers are still frozen in time (and will remain frozen) because of their ultra-low, never-gonna-happen-again interest rate, those savvy and knowing that 'real estate never loses' and that words of wisdom 'buy real estate and wait' is the key to how you make big money when investing.
Years have passed, and not moving has brought unnecessary stress to many whom are or have lived in a home that they've truly not liked. So we are seeing a massive shift for people to finally jump out of their 2-3% interest rate comfort zones, find the new home of their dreams and the one that they've been waiting to procure and the one that fits their lifestyle.
"Their cashing out on the equity, putting down large down payments on their new Dream Home, and for doing so, they are WINNING their new home at a slightly higher interest rate, but at a lower monthly mortgage payment."
So at the end of 2024 you've probably noticed that you have new neighbors and your old neighbors have relocated to somewhere warm, or a really AWESOME new home. We'll, that's what's happening, and for 2025 analyst are saying this is a smart move.
If you'd like to meet me for coffee or lunch to discuss your Dreams or Goals of moving into a home you really desire, give me a call at 763.843.2905. We have a lot of Pre-Approved buyers right now and weekly we are receiving calls from many private selling buyers whom want to sell their homes. This might be the RIGHT time for you to make your Move, and I'd be happy to help you be a 100% success, whether you are looking to move anywhere here in Minnesota, throughout our great Nation, or internationally as well!
Zane Petersen Real Estate (LPS | CLHMS | PMP) - On Lake Minnetonka
763.843.2905 or [email protected] - www.zanepetersen.com
*Zane is Double Certified in Luxury Homes and Marketing by the Institute of Luxury Home Marketing.
Broker - Coldwell Banker Global Luxury on Wayzata Bay
