Re:Where Can the Middle Class Buy a Home?
by josephlord on Thursday October 10, 2013 @06:43PM
(#6530491)
From that it seems to assume a four times salary purchase that is largely borrowed. The calculation is based on current borrowing cost and looking at historical interest rates a doubling of the current rate seems plausible in 5 to 10 years potentially putting those buying these currently affordable houses into trouble.
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Re:Where Can the Middle Class Buy a Home?
by runamok on Thursday October 10, 2013 @07:56PM
(#6530759)
I wonder about that too. The thing that seems to remain constant is your monthly payment which is of course influenced by the interest rate. So presumably a high interest rate would make a lot of home prices go down.
Re:Where Can the Middle Class Buy a Home?
by Domenic_S on Thursday October 10, 2013 @06:57PM
(#6530540)
Which is why you get a fixed-rate loan...
Re:Where Can the Middle Class Buy a Home?
by josephlord on Friday October 11, 2013 @04:18AM
(#6531953)
Can you get a multi-decade fixed rate mortgage in the US? I don't think that they are obtainable in the UK, most fixes only cover the first couple of years. Is it a two way commitment so that you are locked in for that time period and it makes it harder to move/downsize or can you pay it off early?
Re:Where Can the Middle Class Buy a Home?
by Domenic_S on Friday October 11, 2013 @02:25PM
(#6534940)
Yes you can. The product most people get these days is the 30-year fixed rate. 15- and 10- year are also available; as you shorten the term, the APR decreases. They typically don't have any pre-payment penalty.