Mortgage rates drop, what does that mean to me, a seller in Wright County?

Rates today dropped to 4 7/8%. This is truly an unbelievable time to buy. But what does it mean to the average seller. I understand that most sellers are frustrated right now, they are not recieving offers and often are having very few showings. But there is some good news. The lower rates means that more buyers are now able to afford your home. Let me demonstrate an example:

List Price=$200,000 Interest rate of 6.5% (most of 2008) Payment would be $1,257.00

List Price=$200,000 Interest rate of 4.875% (12/15/2008) Payment would be $1,054.00

The average buyer will now save $203.00 per month with the better interest rate. That also means that they can afford more of a house. So if they can only afford an $1100 payment, your home is now affordable to them, where as for most of the year it was not. Now you still have to have good credit and a job to qualify, but if you meet these requirements, you can buy a home today that was out of reach just a month ago.

As sellers, if you need to sell. It may be time to price your home even more aggressively than before. In a nutshell, with rates and prices where they are today there has never been a better time to buy!

And for the sellers. You will take less now than three years ago, but more than likely, you will buy something else. And you will pay less than you would have three years ago.

Keep this in mind. In 1981 rates were at 18%. This is not the worst housing market we have ever seen. You could argue, if your a buyer, that it's the best!

Feel free to contact me with any of your questions.