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The conditions in the residential real estate and mortgage markets are so much different now vs the late aughts. Lending is more conservative, appraisals are mo
by spinchange 5y ago
The conditions in the residential real estate and mortgage markets are so much different now vs the late aughts. Lending is more conservative, appraisals are more conservative, borrowers are stronger, and there's not a glut/oversupply of new housing.
- quickthrowman 5y agoThe interest rate risk is higher than it has ever been. If the long end of the yield curve climbs, mortgage rates will go up and housing values will go down, 100 bps increase could reduce prices by 20%
- Flatcircle 5y agoRising Interest rates would absolutely destroy the housing market. Simple as that
- phreeza 5y agoOut of curiosity, what proportion of monthly costs do interest payments typically make up for a mortgage holder in the US? In Switzerland they current make up 25-30% if you are in the affordability range that banks suggest, with the rest going to taxes, upkeep etc. And renting a comparable property is 50% or so more experience. So I feel like there is some slack until it starts heavily affecting the decision whether to buy or rent.
- phreeza 5y agoHere in Switzerland the calculation on whether you can afford a mortgage is made based on a fictional increase of interest rates to 5%, so probably the same people could still afford the same mortgages for quite a while. Prices are still insane.
- mvc 5y ago5%! Pfft you kids have got it easy. My first mortgage was 7.8