Most buyers don't buy based on the price of the home but based on how much money they will have to write a check for each month. A higher or lower interest rate can make a huge difference in that monthly payment.
The average house in Key West is anywhere between $700,000 and $1,00,000. Let's use $an $800,000 purchase as an example. We will use a standard 80/20 mortgage for our example. 80% of $800,000 is $640,000. The monthly payment on a $640,000 loan at 3.0% is $2,698 before taxes and insurance. The same monthly payment on a loan of $640,000 at 4%, just 15% higher, is $3055. That is a difference of $357 a month in your payment.
Now, if we base that difference on a 30 year mortgage you will pay $128,520 more to own your house. Buyers, watch the interest rates closely. As you can see, the difference of just 15% makes a very big difference.
Gary
Gary McAdams, PA
Realtor/Notary Public
Barbara Anderson Realty
Key West, Florida
