Are you waiting to see if price come down before you buy
Pat Zaby provided this interesting chart to show what just a 1/2% interest increase can do to a home buyer's purchasing power
Get Buyers Off the Fence
It might be time for buyers to get off the fence? Consider this from Pat Zaby of Seminars & Systems by Pat Zaby.
"Did you know that a 1⁄2% change in interest is approximately equal to a 5%
change in sales price?"
This is a powerful statement which makes it clear that Buyers and sellers need to realize the importance of the relationship of interest rates to the monthly payments.
When you take this into consideration and add the $8,000 tax credit that will end on April 30th, one has to think about whether waiting much longer makes good financial sense.
"Did you know that a 1⁄2% change in interest is approximately equal to a 5%
change in sales price?"
This is a powerful statement which makes it clear that Buyers and sellers need to realize the importance of the relationship of interest rates to the monthly payments.
When you take this into consideration and add the $8,000 tax credit that will end on April 30th, one has to think about whether waiting much longer makes good financial sense.
Change in Interest vs. Reduced Sales Price
Purchase Price $200,000
Interest Rate 5%
Term 30
Payment $1,073.64
1⁄2% Increase in Rate $1,135.58
5% Increase in Price $1,127.33
A 1⁄2% change in interest rates is approximately equal to 5% change in price
1% Increase in Rate $1,199.10
10% Increase in Price $1,181.01
A 1% change in interest rates is approximately equal to 10% change in price
Copyright 2010, Pat Zaby
