Move Forward by Looking Back

Our local real estate market feels like it’s changing again. Ask your favorite Realtor what they are seeing with listing activity, and how they think prices will react in coming months.

On the lending side, let’s look back ten years and take the helicopter view.

In October 2008, the reported Freddie Mac interest rate for a 30-year mortgage, with a 20% down payment, was 6.20%. Tehachapi home prices were around $222,000 at that time, making a monthly house payment something like $1087 per month, before taxes and insurance.

In March 2011, if the price was $174,000 and rates were 4.84%, the monthly cost was $733.70 per month.

Today, with a price at $272,000 and a rate 4.83%, your monthly feels like $1145 per month.

Do you see what I’m seeing? Prices go up, and prices go down. Mortgage rates go up, and they go down. If you are a speculative real estate investor, trying to time the market is a matter of dollars and sense. When you are buying your home as a safe place to raise your family, you get to participate in whatever the market is doing at that time.

Be fully informed about your financing options as you head into such a big decision. Don’t let the media scare you away. Ask your local mortgage advisor what is real for your current situation and make your best decision from there.

Tammy Engel is your local Mortgage Advisor.  She’s been working for your best interest since 1990.  Contact her at 661/822-7325 for your next purchase, refinance, or reverse mortgage.  NMLS #235051 CaDRE#01273839