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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: gerard mangiardi who wrote (28837)	9/15/1999 4:32:00 PM
From: ynot	Read Replies (1) \| Respond to of 50167

true about home mortgage costs, however where i am the buyers RUN to buy new houses as the rates are GOING UP, weird but true i believe it is the desire to 'lock' in rates and avoid uncertainty as well as partcipating in the inflation 'value' increase of the home they are about to buy...not a simple example, i've been watching the home market, new and used, for over 25 years rate increases cost more monthly, but the correlated increase in home 'values' offsets the increase monthly cost by boosting borrowing power at least that's what i think ;) ynot ;)

To: gerard mangiardi who wrote (28837)	9/15/1999 5:09:00 PM
From: MeDroogies	Respond to of 50167

That isn't a higher price. It's a relatively raised cost of living for anybody who gets a mortgage at those rates.....which, it turns out, are few. These people then get a break several years later when lower rates (due to lower inflation) refinance and save a bundle (hey - I'm one of them!). When I mortgaged at 8.5% several years ago, I cut back spending elsewhere. This reduced demand (admittedly, my demand was minimal in the overall scheme), which lowered prices. Rates come back down, I refinance, and I'm wealthier now than I was before. It's a cycle. Learn it, live it, earn from it.