Boston Home Buying
This year has been the year for new lows as mortgage interest rates hit new lows for the 10th time. I told a client earlier this year that I didn’t think rates would go below 3%. I am happy to be wrong.
Speaking of records, 2020 has been breaking a lot of long-standing records. Did you know that we hit an all-time high in unemployment in 2020? 14.70 percent in April of 2020.
Basically, it boils down to many homeowners not wanting to sell if it means losing their super-low mortgage rates. As one Beacon Hill condo owner stated: “No way will I give up my 3.25% mortgage, without some very compelling reasons.”
The phenomenon, called “lock-in,” is quite serious, according to a recent study by DePaul University’s Institute for Housing Studies.
So let’s get this straight: A monetary policy of low interest rates designed, in part, to spur housing and economic activity is actually causing slower housing and economic activity.
Makes sense to us!
File under: Damned if you do, damned if you don’t
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