Home Builders across cities like Phoenix are now offering ultra-low 2.99% teaser mortgage rates to lure in buyers to their properties. These teaser mortgage rates are eerily reminiscent of what was happening right before the 2008 Housing Downturn.
The mortgage rate discount referenced in this video starts at 2.99% in Year 1, then increases to 5.99% by Year 4 of the loan. Meaning that anyone who buys a house with this type of mortgage rate will have very low payments in the first couple of years, and then a big increase in payments down the line. This setup could force a lot of owners to eventually sell the houses they bought as their payments increase to a level where they no longer can afford them.
Now - Mortgage Rates are likely to decrease in future years as Jerome Powell and the Federal Reserve eventually shift to cutting rates. Right now the betting markets think the Fed will cut short-term rates down closer to 4% by the end of 2024, which will likely translate to a Mortgage Rate of around 6%.
This type of mortgage rate will bring some buyers back into the Housing Market but is unlikely to result in a boom in demand. Especially in real estate markets like Arizona, Texas, and Florida, where the local economies are now tilting into a downturn. --- Access Exclusive Data and Videos as a Channel Member: https://www.youtube.com/channel/UCVTQunGrE3p7Oq8Owao5y_Q/join
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