Mortgage rates have fallen to historic lows, thanks to uncertainties surrounding the economic impact of the coronovirus. The average 30-year fixed-rate mortgage hit a record 3.29% this week, which is the lowest ever in its nearly 50-year history. Here’s what that means for homebuyers and homeowners in San Francisco and across the country.
By the Numbers
If you bought a million dollar house in the city late last year, locking in your interest rate on December 5, 2019, you likely got something around the 4.02% range. Assuming you borrowed $750,000 on a 30-year fixed-rate loan, your payment would be $4498.
That same house and loan at today’s interest rate would cost you $309 less every month — well over $3000 annually. Savings like that have kickstarted another boom, with homeowners across the country calling their mortgage lenders to about the benefits of a refinance. Mortgage applicants are likewise spiking, a good sign for the looming spring buying season.
Signs of What’s to Come?
In a city like San Francisco, tight supply can make taking advantage of historic mortgage rate lows tricky, not to mention the fear of what the future economy might do. But if you had the guts to buy in the downturn of 2010 – and it took some nerve to commit then – you would be looking like a financial genius today.
If you’re in the market to buy or looking to sell, an experienced agent makes all the difference. Ping me and I’ll be happy to walk you through where your best opportunities lie and where you may run into trouble. And if you plan to take advantage of these historic lows to refinance, be nice to your mortgage brokers right now. Everyone on their team is going to be running on 18-hour days and little sleep. If you need a recommendation, I know brokers who offer great customer service, competitive rates and they handle the pressure well!