Even if you aren’t thinking about buying a home, you may have heard that mortgage rates have plunged to record lows. That may seem like great news, but it’s hard to know just how much you’re saving by taking advantage of rock-bottom rates.
Here’s what you need to know about today rates…and how they’ve changed since your parents and grandparents bought their homes.
Mortgage Rates Have Gone Up and Down, But They’ve Never Been This Low
Currently, the average rate for a 30-year fixed mortgage is about 2.96%. So if you’re buying a $300,000 home, that means you should expect to pay around $1,258 per month. While this may seem surprisingly affordable, that hasn’t always been the case.
Let’s take a look at how rates have fluctuated over the decades—you may be surprised to learn how much money you can save if you buy now!
Rates remained sky high throughout the 70s and 80s
Forty years ago, mortgage rates soared past 8% and got as high as 12.7%. Due to inflation, home buyers in the 80s could expect to pay around $3,248 per month if they lived in a $300,000 home—that’s almost triple of what you’d pay if you bought a similar property today!
The 90s and 2000s brought low rates
Thankfully, rates began to go down during the 1990s, but they were still significantly higher than you might expect. If your parents bought a home in the 90s, their rates were probably around 8.12%. The 2000s ushered in even lower rates that were around the 6% mark, but most mortgage payments were still around $1,855.
The 2010s and 2020s saw the biggest rate drops in history
After the 2008 housing crash, the Federal Reserve began to drop interest rates to historic lows. Since then, they’ve mostly trended downward, which is fantastic news for today’s home seekers. Back in the 2010s, buyers who purchased a $300,000 paid just $1,448 a month for their mortgage thanks to rates of around 4%. Today, those numbers have fallen to $1,258 and 2.96%, respectively.
Bottom Line: Now Is the Time to Buy
The numbers don’t lie—there’s never been a more affordable time to buy a home. If you’re on the fence about making a move, you should seriously consider taking advantage of interest rates while they remain at record lows.
Despite the global pandemic and economic downturn, Pittsburgh’s market remains strong, and our team is always on hand to answer your questions!
Ready to Buy a Home in Pittsburgh?
If you’re thinking about making a move to Pittsburgh, the Jim Dolanch Team is here to help. We have plenty of tools to help streamline your move, and you can even calculate your monthly payments with our mortgage calculator!
Have questions? Don’t worry—we have the answers you need. Give us a call today to kickstart your real estate journey.