Tuesday, September 18, 2012


There are very few times in history when there is a convergence which gives great opportunity to those who are informed and who are capable of action.

We all can agree home prices are on sale, many are in the area of 50% off there highs for just a few years ago. If you were to walk onto a car lot and you were able to purchase a new car for 50 cents on the dollar, I'm sure you would act upon the opportunity.  Price is one of the elements in this convergence.

Another element is money, which is also on sale. Interest rates on a 15 year mortgage are near 3%. An interesting fact which occurs when rates get this low is 66% of the monthly payment pays down the principle, resulting in a faster reduction to the loan. If a 15 year loan carried a rate of 8.5% the principle reduction would be roughly 33%.

The final element of the convergence is property taxes, which differ from a loan as you will never stop paying this part of the convergence. If you purchased a 300.000 home a few years ago your annual tax burden would be $3,900 where as if you purchased the same property today at 50% off your tax payment would be $1,950. If you were to keep the home for 10 years, the overall tax savings would be $19,500.

In conclusion - Prices are down, interest rates are down and taxes are down. Are you capable of action because you have now been informed?

Scott Hopper - Realtor, 530-477-2277

"If you enjoy reading my blog, please keep me in mind when you or a friend needs a real estate professional"

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