Insider Intel January: Buy now. Here’s how.

Each month we explore the regional housing markets of San Diego and Orange County; from city by city sales data to inventory, inflation, mortgage rates and, other economic factors and trends. Real estate is, by nature, local, and our markets may not be entirely reflective of national trends—especially since we benefit from the unique luxury price point we live in. We hope that this month’s report helps you to be more informed and make smart real estate decisions.

This month, our spotlight is buydown options.

We are seeing the lowest mortgage interest rates in the past four months and expect them continue their slow decline throughout 2023.  With a drop in mortgage rates, borrowers are now gaining back their purchasing power and re-entering the housing market.A loan buydown can reduce borrowers’ monthly mortgage payments for 1-2 years, enabling them to refinance to a permanently lower interest rate when rates decline. What’s great about this program is that homebuyers can purchase a new home at more affordable payments giving them two years to make lower mortgage payments and ease into the full payment based on the note rate amount. So essentially, homebuyers will get two years of lower payments.In a buyer’s market, the 2-1 Buydown Loan is often used to make it faster and easier for sellers to sell their homes at a reasonable price, as the seller traditionally pays for most temporary buydowns as a closing cost equal to the buyer’s interest savings.There are two loan buydown options we recommend:
  • A 2-1 buydown reduces the payment rate by two percentage points in the first year, then by one percentage point in the second year, before rising to the full payment.
  • With a 1-1 buydown, the payment is reduced by one percentage point for two years.

Insider Intel Full Booklet:

If you’re looking for more information about the real estate performance in many of Southern California’s most in-demand markets, click here to view the Pacific Sotheby’s International Realty IN FOCUS market reports.
Whether you are a first-time home buyer, an interested seller or building your investment portfolio, our reports are your best resource to make smart real estate decisions today.
The information provided on this blog does not, and is not intended to, constitute legal or tax advice. All information, content, and materials available on this blog are for general informational purposes only. Information on this blog may not constitute the most up-to-date legal or other information. Readers of this blog should contact their attorney and/or tax advisors to obtain advice with respect to any particular legal or tax matter. No reader, user, or browser of this blog should act or refrain from acting on the basis of information on this site without first seeking legal advice from counsel in the relevant jurisdiction. Only your individual attorney and/or tax advisor can provide assurances that the information contained herein and your interpretation of it is applicable or appropriate to your particular situation.

No Comments Yet

Leave a Reply

Your email address will not be published.