Home Forums Hunting & Shooting Hunter's Campfire Building Back Better, with mortgages hitting 6%...

New 30 year mortgages hit 5.99% last week, after Powell's speech in Jackson Hole. Housing starts have already dropped by over 20% and this will not help.

https://www.forbes.com/advisor/mortgages/mortgage-rates-09-01-22/

Today, the average rate for the benchmark 30-year fixed mortgage fell to 5.99% from 6.03% yesterday. One week ago, the 30-year fixed was 5.96%. The 52-week high is 6.11%.

On a 30-year fixed mortgage, the APR is 6.01%, higher than it was last week. APR, or annual percentage rate, includes a loan’s interest rate and a loan’s finance charges. It’s the all-in cost of your loan.

At an interest rate of 5.99%, a 30-year fixed mortgage would cost $599 per month in principal and interest (taxes and fees not included) per $100,000, according to the Forbes Advisor mortgage calculator. In total interest, you’d pay $115,607 over the life of the loan.

Ouch!

Double what it was from when that azz hat took over.

I expect most building construction will be put on hold for 1-2 years until interest rates come down. It's a cycle that repeats again and again. I'm hoping things slow enough that materials come back down to earth.

I mentioned this in another thread the other day, but my neighbor and I got some new home bids recently. What was a $350k home build in 2019/2020 is now being bid at $480-$530k. And interest rates are nearly double. So a $1,100-$1,200 mortgage becomes a $2,200 mortgage for the same home, 2-3 years later. That's not sustainable.

Wholesale lumber costs are already pretty much at pre-covidiocy prices. There is still a large shortage of housing, and the demand will continue to support building. I expect the interest rate is going to hit the McMansion industry very hard, and we already see that in the drop in new single family housing starts. We actually saw an increase in multi-family building over the last quarter, and that makes sense to me. Rents for apartments have shot out of sight, and the cost of construction per unit makes renting apartments financially a VERY attractive proposition.

I guess the lumber prices will start going down some if the demand goes down.

It’s the Night before Darwin …

And All the F’ck Tards who hate Orange want “Red”

With Vision of Stimulus Checks Bouncing in their
Air Pockets …

Yes it’s the Night before Darwin

I see Dead People all the time

They just don’t know their Dead ..

Yes It’s the Night Before Darwin …

When we got 6.25% in 1998 we thought it was a damn good rate. Now everyone is buying 2X more house than they need and that $120K house is going for $320K and screaming about 6% being too high.

Locked in a 30 year at 2.85% a little over a year ago, better to be lucky than good I guess.....

I borrowed from my Grandad in 1984. Put it in escrow at 10%. Banks would have been 12% to 13% on real estate. Grandad was getting about 8% on his CDs. It was a winner for both of us.

New vehicle 82 was 17% from the dealer's bank, for a young man with short, but good credit history.

No, you did not see 72 or 84 month auto loans at those rates.

My new purchase was refinanced quickly through the credit union at work.

But, yes, it could get a whole hell of a lot worse.

You guys have short memories. The rate on this house in '95 was around 7%. I remember a number of people having to pay 10%. Thank goodness I was able to pay it off in '07.

Yes, at 6%, mortgage rates are still in historic lows, but will that lower the cost of a new home? I’m guessing not for a while. I think I’ll hunker down where I’m at for a while, and thats not a bad thing, thankfully.

We bought our house 10 years ago and we paid $400,000. We locked in at the time at 4% for 30 years. I told my wife that we’d never refinance because the rates would never drop below 3.75% anyway. Earlier this year I refinanced with no fees and no equity being withdrawn and locked in at 3%. It dropped our monthly payment by almost $1,000 and we have a 30 year at 3%. The house is now valued at $1.1 million. We’ve had a number of people and agents wanting us to sell but we are not willing to sell right now since we’re taking care of my mother in law. It’ll keep going up so I don’t worry about it until I’m ready to sell. When that day comes I’ll be thrilled taking the money and running out of this state as fast as I can.

During the Jimmy Carter years mortgage rates were in the high teens.

I seen bank statement from my grand parents when we cleaned out her house. At one time she had couple hundred grand thru different banks around town in 5year CDs at 13%. She was also playing the 3 and 6 mo CD switcharoo game at up to 18%. Crazy.

While I agree that home costs are to the moon right now, I don't think that's slowing building. At least not around here. Hell, anywhere there is enough open land a builder is jamming a house in it.

6% is not that high really. A lot higher than it has been. But it isn't bad. It is though, when you're buying more than you can reasonable afford.

Would it be the end of the world if Little Johnny had to share bedroom and a bathroom with Little Jimmy? Probably not. People are going to have to stop buying a 4800 SF home that stretches the budget and buy a 2500 SF home that doesn't.

Still waiting for prices to cool down.

No, it's not. Especially when families are having trouble just putting food on the table.

The DC Uniparty does not care. They're eating caviar and ice cream.

Need to be swinging from a rope.

Houses being finished now have had their construction and take out loans set in the 3% era, not the current 6% era.

6% is entirely reasonable, but it's double what we had for a long, LONG time. Forever, in the mind of the younger generations who have never seen anything different. Nothing down, virtually no interest, and 10-30% annual appreciation -- buy all you can! 6% and virtually no appreciation for a decade will be a big shock.

Average house size being built today is over 2,800 square feet, compared to 1,000 in 1960. Many of the current generations would "struggle a bit" trying to adapt to five kids in a 1,000 square foot home.....

6% was a deal not to many years ago.
gonna need that extra 1k a month to cover your property taxes since its now valued at 1.1 mil

If what you were paying a month wasnt an issue for you, I'd probably have done a 15 year fixed and keep the monthly payments the sameish, probably a little less.