While 2020 was a challenging year 2021 is off to a good start. It seems that the exodus from New York State is continuing and home sales are supported by historically low mortgage interest rates. The first mortgage that my wife and I had in the early 1980’s was 13%! I remember asking my father what his mortgage interest was when he and my mother bought their first house circa 1958 and he said that it was, “6%”.
So for those buying a home these days, a mortgage interest rate of 2.5% is truly historic. Here is a comparison.
- For a $200,000 mortgage, 30 year term at 6% results in monthly principal and interest payments of $1199/month. Over 30 years, to borrow $200,000 you’ll pay a total of $431,676. You’ll pay more in interest than the original loan amount!
- For the same $200,000 mortgage. 30 year term at 2.5% results in monthly principal and interest payments of $790/month. Over 30 years, to borrow $200,000 you’ll pay a total of $284,487.
- 6% vs. 2.5% saves the borrower, over 30 years, $147,189!!!
I believe a combination of the flight from the big apple and low rates will support a good real estate market in 2021…let’s hope.
Here are a few homes we’ve inspected at Regal Home Inspections so far this, new year.
Monmouth County NJ Certified Home Inspections
It’s likely your mortgage company will require a wood-destroying insect inspection. Regal Home Inspections has the NJ DEP Core & 7B Pesticide Applicator license, so we can offer professional termite and wood-destroying insect inspections as well!
Both of our inspectors are also licensed to perform radon inspections. We have NJ DEP issued Radon Measurement Technician licenses and are affiliated with the best radon lab in the state.
Call 908-902-2590 for your free quote or if you have any questions!