Interest rates are always an important factor when buying Palos Verdes homes for sale. Whether you’re a buyer looking at a $1,000,000 mortgage at 3.75% at $4,630/mo or the same mortgage at 5.75% (still low by historical standards) at $5,836/mo; that $1,200/mo difference is a big deal!
If you’re a seller of Palos Verdes homes for sale, what interest rates are doing therefore will certainly effect the price you would ask for your home. Some title company statistics show that people are staying in their homes an average of 7 years (personally I think owners of Palos Verdes homes for sale have stayed in their homes for much longer) that $1,200/mo over 7 years is an increased cost to a buyer of Palos Verdes real estate of over $100,000.
Clearly then pricing is a function of interest rate. So if you’re planning being one of the Palos Verdes homes for sale, what can you keep a watch on to determine WHEN THE FED WILL RAISE RATES? I read an article by Tony Crescenzi of Pimco.com recently that provided some pretty good information on that question. Summarizing… Key Points:
- To decide when the Fed might begin to taper its asset purchases, closely monitor the Fed’s favorite labor market indicators.
- Investors need be alert for signs of progress in the many employment indicators the Fed is watching, and listen closely to what the Fed is saying to know when bond buying will be tapered.
- The failure to achieve “escape velocity” is why the Fed is using its printing press to purchase $85 billion of securities monthly. These purchases will continue, the Fed says “until the outlook for the labor market has improved substantially.”
The Fed has made progress toward achieving escape velocity but the progress must be sustained for the Fed to throttle back on its stimulus. If you’re interested, you can read the full article here: http://www.pimco.com/EN/Insights/Pages/Telling-(Taper)-Time.aspx
Of course, no one has a crystal ball, certainly not me. Yet I wanted to share with you the best indicators I can for how we can “read the tea leaves” so that we can figure out the best course of action for your either buying one of the Palos Verdes homes for sale OR whether you want to get on the market and compete against the other Palos Verdes homes for sale.
Meanwhile, here’s a handy tool for you to study at what price recent Palos Verdes homes for sale did closed escrow.
And to study other community features around Palos Verdes homes for sale, please feel welcome to use this LifeStyleFinder tool: George Fotion on Google+
George Fotion, HomeIsPalosVerdes.com
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