Figuring Out The Market Today

With the high rate of foreclosures still expected to come onto the market in the near future-we can expect property prices to continually fall.  In this chart below-we can see the trend that is taking place.

But-if you continue to wait for prices to fall-you may be missing out on the lowest interest rates we have seen in a long time.  This graph below shows that for every percentage point interest rates rise-property prices will have to fall at least 10% to have the same monthly payment.

However, it is difficult to predict how far interest rates will rise.  What we do know is that the government will be less and less involved with rates and as the private sector takes over-of course they will raise them-to make money.

In this graph you can see what has happened over the last few years with mortgages.  The green is private lenders and the blue is government loans.

There is going to be a shift back to more private lending and in reading predictions-they are thinking anywhere from 6-8%.

It is hard to know what the future of real estate holds.  But with interest rates going up and property prices expected to continue to fall-it makes sense that now is the time to both buy and sell!