What is truly going on with the DC area real estate market, please explain?

[Anonymous]

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

Not that crazy, but going from say 4.25% to 3% allows one to afford about 17% more mortgage on the same payment. That's quite a lot.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

Not that crazy, but going from say 4.25% to 3% allows one to afford about 17% more mortgage on the same payment. That's quite a lot.

If you were qualifying for a mortgage rate of 4.25% in 2016/7 your credit was terrible and/or your down payment was insufficient.

[Anonymous]

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

I agree with this. I don't think rates are as big a player as everyone is saying. I'd be curious how much demand has actually gone up, vs supply just being terribly low.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

Not that crazy, but going from say 4.25% to 3% allows one to afford about 17% more mortgage on the same payment. That's quite a lot.

If you were qualifying for a mortgage rate of 4.25% in 2016/7 your credit was terrible and/or your down payment was insufficient.

Not really, the average mortgage rates in '16,'17 and '18 were 3.7, 4 and 4.5 percent respectively. The last six months is about 2.8%. It's an enormous difference from an affordability perspective.

[Anonymous]

Yeah Potomac dc is not a thing. Palisades?

[Anonymous]

And to add, it's important to remember that rates were hovering in that 4% +/- range since the early 2010s.

The recent drop in the last year is the first time they've really broken down like this.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

Not that crazy, but going from say 4.25% to 3% allows one to afford about 17% more mortgage on the same payment. That's quite a lot.

If you were qualifying for a mortgage rate of 4.25% in 2016/7 your credit was terrible and/or your down payment was insufficient.

Not really, the average mortgage rates in '16,'17 and '18 were 3.7, 4 and 4.5 percent respectively. The last six months is about 2.8%. It's an enormous difference from an affordability perspective.

Yes really. You’re indicating a mortgage rate a quarter to half a percent higher than the average rate (for 30 years might I add) in 2016/2017. That type of higher rate comes for a reason - either you added points, didn’t have a acceptable down payment or terrible credit. Buyers aren’t penalized for no reason.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

Not that crazy, but going from say 4.25% to 3% allows one to afford about 17% more mortgage on the same payment. That's quite a lot.

If you were qualifying for a mortgage rate of 4.25% in 2016/7 your credit was terrible and/or your down payment was insufficient.

Not really, the average mortgage rates in '16,'17 and '18 were 3.7, 4 and 4.5 percent respectively. The last six months is about 2.8%. It's an enormous difference from an affordability perspective.

Yes really. You’re indicating a mortgage rate a quarter to half a percent higher than the average rate (for 30 years might I add) in 2016/2017. That type of higher rate comes for a reason - either you added points, didn’t have a acceptable down payment or terrible credit. Buyers aren’t penalized for no reason.

I'm not talking about myself, I'm talking about the average rate from 17/18, which was 4.25%.

[Anonymous]

The mortgage rate falling since 2016 did not make high price homes more affordable.

We lost one million mortgage write off and SALT so a wash at best

[Anonymous]

Anonymous wrote:The mortgage rate falling since 2016 did not make high price homes more affordable.

We lost one million mortgage write off and SALT so a wash at best

The 1 million write off and SALT is not a significant player in this area.

Taxes are relatively low and most houses cost under $1M, which means an average mortgage balance probably right around $750K.

[Anonymous]

Gilded city with recession proof jobs and poor people being pushed out.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The real estate market is crazy because interest rates are extremely low! 4 years ago, the rates were more than double what they are now. Prices are a direct result of interest rates.

4 years ago interest rates were around 3.5 - 3.8%. Its now 2.9 - 3.1%. Don't kid yourself - the difference isn't that crazy.

Its not like its back to Carter days of 8 - 9%.

Not that crazy, but going from say 4.25% to 3% allows one to afford about 17% more mortgage on the same payment. That's quite a lot.

If you were qualifying for a mortgage rate of 4.25% in 2016/7 your credit was terrible and/or your down payment was insufficient.

Not really, the average mortgage rates in '16,'17 and '18 were 3.7, 4 and 4.5 percent respectively. The last six months is about 2.8%. It's an enormous difference from an affordability perspective.

Yes really. You’re indicating a mortgage rate a quarter to half a percent higher than the average rate (for 30 years might I add) in 2016/2017. That type of higher rate comes for a reason - either you added points, didn’t have a acceptable down payment or terrible credit. Buyers aren’t penalized for no reason.

I'm not talking about myself, I'm talking about the average rate from 17/18, which was 4.25%.

We have 800 credit scores and had a "low" rate of 4.15% in 2018 so I agree with you.

[Anonymous]

Honest question, but why would lower rates mean more demand? Wouldn't the ppl in the market for a house stay the same, they can just afford more? All these ppl looking for a home, would they not be looking if rates didn't drop?

[Anonymous]

Anonymous wrote:Honest question, but why would lower rates mean more demand? Wouldn't the ppl in the market for a house stay the same, they can just afford more? All these ppl looking for a home, would they not be looking if rates didn't drop?

I know people desperate to buy who literally can't afford to regardless - so rates don't matter if you don't have the income or down payment to afford the home.

[Anonymous]

Anonymous wrote:Honest question, but why would lower rates mean more demand? Wouldn't the ppl in the market for a house stay the same, they can just afford more? All these ppl looking for a home, would they not be looking if rates didn't drop?

Cost always matter at the margin.