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Old 01-28-2009, 08:50 AM
 
Location: New York, Westchester
506 posts, read 2,003,776 times
Reputation: 232

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I was rushing the kids out of the house for school and i think it was fox news and they were talking about a new proposal to bring the mortgage rate down to 4% to get money moving again and helping the real estate market . The were talking to a senator who was agreeing with it... did anyone see this or here anything about this??????????????
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Old 01-28-2009, 08:58 AM
 
Location: Martinsville, NJ
6,159 posts, read 10,900,560 times
Reputation: 3939
Quote:
Originally Posted by westchester View Post
I was rushing the kids out of the house for school and i think it was fox news and they were talking about a new proposal to bring the mortgage rate down to 4% to get money moving again and helping the real estate market . The were talking to a senator who was agreeing with it... did anyone see this or here anything about this??????????????
I contend that high interest rates are not what is keeping the real estate market in the doldrums. I mean, come on. You can get a 30 year fixed rate loan at 5% these days. That's almost free money, when you figure in the tax deductability of the interest payments. High prices, general economic uncertainty, and speculation that interest rates will come down further, those are the things that, in my opinion, are keeping things from moving faster. I suggest that there are many fence sitters waiting for the bottom. And the only proof they will accept of bottom is an INCREASE, in either prices or interest rates. They don't want to buy today and find out they could have bought for less next week. They will be more satisfied if they buy today, and say damnit I could have bought for less week. But they'll KNOW they didn't miss the bottom.
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Old 01-28-2009, 09:49 AM
 
Location: New York, Westchester
506 posts, read 2,003,776 times
Reputation: 232
I agree with you everyone wants to be "that person" who paid the least and got the best rate......I always tell people don't be greedy just be Happy the rates are as low as they are... I was just wondering if anyone had seen that news article twha they were talking about...good luck
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Old 01-28-2009, 09:55 AM
 
1,134 posts, read 2,470,582 times
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I'm a fence sitter.

I'm sitting because of employment uncertainty, and price instability - not interest rates. In fact, rates aren't really that huge of an incentive or deterent IMO - generally as rates go up, prices come down and as rates go down, prices go up.

I work for a gov contractor, but on a state contract. States are all tightening their belts... so I wonder whether I'll have a job or not in the next two years. Meanwhile, my uncertainty just allows me to continue saving up additional downpayment - so no real loss in waiting. Rates aren't going to pop up into the stratosphere overnight.

I do wonder whether we've hit the bottom as far as price declines, but I also think that low interest rates just prop up artificially high prices. So what happens when the crisis is over and rates rise? Will the value of my new home plummet? With all of this gov spending and printing of money, what will this mean for inflation in years to come? What does that mean for my home value?

It's a complex bag - with a lot of questions, uncertainty. Buyers hate uncertainty.
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