KUNO Real Estate

Since my last blog a while ago nothing much has changed in the real estate market. It still is a fantastic opportunity to buy any real estate. What is making the housing market a little different is the 10 year note yields are starting to come down finally. As I said to my Congressman and I will say it here, get rates down and this will help to stabilize the real estate market/economy. The 700 billion dollar bail out is not filtering down to main street at all. What we need is 1% interest rate on 30 year fixed mortgages and you will see how the bleeding will stop. This will have a trickle effect which will help the economy and local governments that rely on property taxes for their budgets. This is not rocket science to figure out but the politicians are not doing anything about it.

10 year note yields have been stagnate for months until the last week or so. This morning Friday-10 year note yields are below 3.0%. When 10 year yields go down so do mortgage rates. Rates were getting down to 5.6%. this week. Today will be a limited trading day on Wall Street/Chicago Board of Trade but Monday morning the markets will get back to normal. I am telling everyone to watch 30 year interest rates next week. This will be a good time to start buying. You may have a week to take advantage of this so act quickly and lock in to your rate. Rates change daily like oil prices in the market we are in. Make sure you get a mortgage that has no pre-payment penalty and you can buy your rate down after you have locked it in. If rates get lower than your lock before you close than pay the small fee around $250 to $500 dollars. Every lender is different so ask. It’s all about playing with numbers.

Historically interest rates are still great even at 6% especially if you are a new home buyer/investor but if you can get a 30 year fixed rate below that it would be worth it. For people with mortgages, the rule of thumb that I use and tell everyone is when your rate is 1% point higher or more than the new interest rate re-finance. The key is how long do you plan on holding on your real estate. It normally costs a couple to a few grand to re-finance. Example; If it costs you $3000.00 to re-finance and you save $200.00 a month on your payments just add up how many months do you need to get to $3000.00. In this example it would take 15 months. So if you were to sell your property in the next year it would not be worth re-financing. If you were to sell 5 years from now than it would be worth re-financing. Just play with the numbers to meet your goals.

Everyone have a Blessed Thanksgiving Weekend!  

Dave Kuno

Kuno Real Estate

www.kunorealestate.com

www.foreclosures-indiana-illinois.com