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Historic Low Mortgage Interest Rates – AGAIN

It’s all over the news this week that the Conventional 30 year fixed mortgage rate dropped to yet another “Historic Low”.  With all the talk about historic low mortgage interest rates it’s difficult to visualize what that really means.  So I thought I would put this into some sort of perspective.

Today is Friday, September 21st, 2012. 

• The 30 Year Fixed Mortgage Interest Rate as of today is 3%.
• The Average Sale Price of a home in the Des Moines Multiple Listing Service for the past 30 days is $175,500.
• A buyer purchasing a home for that amount today using Conventional Financing with a 5% down payment would take out a mortgage of $166,725.  ($175,500 x 95% = $166,725)
• The Principal & Interest payment on this amount would be $702.92 per month.

Now let’s compare these same numbers to January 1st, 2010.

• The 30 Year Fixed Mortgage Interest Rate on January 1, 2010 was 4.875%, just short of two full percent from today’s rate.
• We will use the same Sale Price of $175,500 with 5% down payment and a mortgage of $166,725.
• A buyer financing the exact same amount on January 1, 2010 would have had a Principal & Interest payment of $822.32 per month. That is a difference of $119.40 per month.

30 Yr Fix Rate Compare to 2010

Buying Power 2010 compared to 2012

What this means is that as of today, that $119 gives you over $28,000 more buying power than you had in 2010!  In other words, assuming your income and expenses were the same today that they were in 2010, the lower mortgage interest rate today would allow you to buy a home for just over $200,000 and your payment would still be LOWER than if you had purchased the same home in 2010 for $175,500.


Des Moines Real Estate Week In Review Ending September 21st, 2012

9-21-12 Actives

9-21-12 Pendings

Total Residential Active Listings – 4,437       
New Listings Taken During the Last 7 Days – 278       

Current Accepted Offer Count (Pendings) 1,594
Accepted Offers (Pendings) During the Last 7 Days – 178

Closed Transactions During the Last 7 Days – 146
Average Sale Price of Solds – $176,077
Average Days On Market of Solds – 103
YTD Solds Ahead or Behind Last Year To Date – 1,106 Ahead

Les Sulgrove, Keller Williams Greater Des Moines
Data Source: Les Sulgrove, Keller Williams Greater Des Moines
10200 Hickman Ct., #100, Clive, IA 50325
Des Moines Area Association of REALTORS® MLS.

Creative Commons 

Des Moines Iowa Real Estate Statistics by Les Sulgrove is licensed under a Creative Commons Attribution- NoDerivs 3.0 United States License.

About Les Sulgrove

Les is an Iowa native born in Des Moines and raised in the southwest Iowa town of Bridgewater. He has been a resident of Des Moines since 1982 and has been married to his wife Linda for over 35 years. Together they have 3 grown children, 7 grandchildren and make their home on Des Moines south side. He has been a licensed REALTOR® since 1990 and is Vice President at VIA Group, REALTORS®. Les is the 2011 Past President of the Des Moines Area Association of REALTORS® (DMAAR) and received the award of Salesperson of the Year by DMAAR in 2007 for his involvement and service to the Association. Additionally, he is active at the Iowa Association of REALTORS® and serves on local, state and national committees. He also owns and operates the national technology networking group CyberProfessionals. This group of real estate professionals meets twice annually across the United States to learn from each other and share new marketing ideas with heavy emphasis on current and future technologies and their use in the real estate business. Les’ hobbies include golf, photography and sarcastic humor. He and Linda spend many Saturday mornings from Spring to Fall at the Des Moines Downtown Farmers Market. He enjoys spoiling his grandchildren at every opportunity.

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