How high will mortgage rates climb in the next 36 months?

Jumbo mortgages are now 7.75%, but I'm sure @usctrojancpa's clients are still getting those low 6 percent rates just for living in Irvine. Reach out to him for further details.

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BofA's on-line conforming (standard, not high balance) is 8.00%/8.29 APR with more than .75 in fee! YOWZA
Their High Balance Conforming is 7.75%/7.834 APR with 25% down oddly enough
Portfolio Jumbo? 7.25%/7.356 APR. That figure can be reduced with relationship asset transfers.

(I use BofA's website, as well as other banks, as banks are more accurate with their pricing than others)

My error. The 8 percent conforming APR is in the 8's, not the 9's per the OP. Regrets for the confusion I caused here.
 
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Isn't the SALT limit of $10,000 expiring in 2025? Anyone thinks that would change anything in real estate including mortgage rates?
 
sgip said:
BofA's on-line conforming (standard, not high balance) is 8.00%/9.29 APR with more than .75 in fee! YOWZA
Their High Balance Conforming is 7.75%/7.834 APR with 25% down oddly enough
Portfolio Jumbo? 7.25%/7.356 APR. That figure can be reduced with relationship asset transfers.

(I use BofA's website, as well as other banks, as banks are more accurate with their pricing than others)
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A 9.29% APR is unbelievable. Everybody is subprime now... at least in terms of the rate they pay.

It also makes no financial sense to purchase a home at that APR. Even if prices continue to rise 2% as they did over the past year, you are paying more to borrow than you are receiving back in appreciation. You could also just rent the same home for about half the cost and avoid the hassle and stress of buying in this environment.
 
Irvine2023 said:
The mortgage interest deduction limit is also set to expire after 2025.
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It all comes down to the election. If Trump wins, the Senate will probably swing Republican as well and they can extend the tax law. If Biden or another Democrat wins, it will go bye-bye.

Currently, Trump is leading the GOP primary by an overwhelming margin and he is also leading Biden in head-to-head matchups. If Cornel West or RFK Jr. run third party, there's almost no chance Biden will win.
 
Irvine2023 said:
The mortgage interest deduction limit is also set to expire after 2025.
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Are you referring to the $750,000.00 limit? If so, mortgage rate has no effect on it, since it's not a fixed amount that you can deduct. The limit is on the loan itself, not the rate. In other words, the higher the rate you lock in at, the more you can deduct more.

Anyway, my response to Mety is that the mortgage interest deduction is not affected by the $10,000 SALT limit.
 
CalBears96 said:
Are you referring to the $750,000.00 limit? If so, mortgage rate has no effect on it, since it's not a fixed amount that you can deduct. The limit is on the loan itself, not the rate. In other words, the higher the rate you lock in at, the more you can deduct more.

Anyway, my response to Mety is that the mortgage interest deduction is not affected by the $10,000 SALT limit.
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Oh yeah I was just mentioning it since it would be favorable to homeowners if they both expire, which I’d think would increase demand.
 
Yes, we know SALT is not for mortgage interest deduction. I was saying like Irvine2023 mentioned, that if SALT limit is expired, the homeowners will get to deduct even more on taxes which can result more demand for buying homes which can have affects on mortgage interest rates. If the home prices go higher, the rates will have to come down.
 
Mety said:
Yes, we know SALT is not for mortgage interest deduction. I was saying like Irvine2023 mentioned, that if SALT limit is expired, the homeowners will get to deduct even more on taxes which can result more demand for buying homes which can have affects on mortgage interest rates. If the home prices go higher, the rates will have to come down.
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Democrats want SALT to increase or removed but republicans do not. SALT mainly impacts left leaning states with higher prop taxes like CA/NY. If push comes to shove dems will leave SALT capped at 10k as it’s more tax dollars coming in for the gov.
 
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Will Jumbo's hit 8% next week? Not that it matters because Irvine is immune from what is happening nationally when it comes to economics. Just look at the -28% price drop during the GFC... Tiny when compared to places like Dallas that had a... well... 0% price drop.

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The stupidity and greed of people never surprises me…any bets on neg ams?🤦🏽‍♂️😂😂😂

Adjustable-rate mortgages are making a comeback​

They earned a bad reputation thanks to their role in the early 2000s housing meltdown. But it appears adjustable-rate mortgage (ARM) deals are making a comeback as homebuyers try to ease the pain of soaring loans. Mortgage Bankers Association (MBA), 9.2 percent of all loan applications were for ARM deals

 
zovall said:
Is inventory increasing compared to 3 months ago?
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Inventory levels in Irvine (which I track closely) have been flattish in the past 3 months, basically around the level of inventory that we had at the end of 2022. There will not be any material price declines unless inventory increases significantly.
 
And the only thing where you have consistent inventory and predictable stock is new homes... which is why those are so overpriced.
 
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