Mortgage Rates Go Up to Highest Level in Seven Years

Exterior wall of an older building in Fort Lauderdale,FL
Exterior wall of an older building in Fort Lauderdale,FL

Freddie Mac released it’s Primary Mortgage Market Survey on May 17th, 2018. It shows U.S weekly average mortage rates.

Freddie Mac 5_17_2018. Primary Mortgage Market Survey
Freddie Mac. Primary Mortgage Market Survey. US weekly average mortgage rates for the last 10 years

For the week ending of  May 17th, 2018, 30-year fixed mortgage rate went up by six (6) points since the last week’s survey, and reached 4.61 percent. This matched the highest level since May 19th,2011. The 30-year fixed mortgage increased by 59 points in one year- when in May 18th, 2017 rate was 4.02%.

For the week ending of May 17th, 2018, 15-year fixed mortgage rate went up by seven (7) points since the last week’s survey, and now  it reached 4.08 percent. 15-year FRM increased by 81 points since the last year when it was 3.27 percent.

 

Freddie Mac 5_17_2018. US weekly avera mortgage rates
Freddie Mac – Primary Mortgage Survey. US weekly average mortgage rates os af 5/17/2018

When the interest rates are higher, the home-buyer has to pay more money when getting a loan.

The buyer gets a smaller house. If there is a set amount of money to be spend a month by a home-buyer, then a buyer has to spend more money for interest. There is less money left a month for an actual loan principal to pay.

What Is an Investment Property?

IMG_9624
Small older house in Hollywoood Lakes neighborhoood in Hollywood, FL

An investment property is purchased with the purpose of gaining a return on investment. It can be any type of real estate, be it a vacant land, an apartment building, a duplex, a single-family home, commercial property. Usually, the property is NOT occupied by the property owner. But sometimes investor buys a few units appartemnt building, live in one apartment and rent the rest. It could be a duplex, when the owner lives in one unit and rents the other unit to a renter.

How Is Profit Generated?

Profits are generated through rental income and/or capital gains.

Property investing involves buying, owning, renting, managing,  and/or selling of real estate for profit.

This type of property is purchased with the goal of  an income by renting the property, buying low and selling high, profiting over time from appreciation, renovating and fixing the property selling it for more than the purchase price.

Improvement of real estate as part of an investment game plan is generally considered to be a sub-specialty of real estate investing called real estate development.

 

Liquidity and Cash Flow

Real estate is an asset with limited liquidity when comparing to other investments.  It is not like cash in the savings acount, not like stocks or shares, when the owner can get cash withdrawal from the saving, or sell the stock and get the money fast. Real estate owner can’t get cash fast, unless sells real estate at discount.

Real estate depends on cash flow. It needs a lot of capital up front , but this capital can be gained with a mortgage. the owner borrows money.

This where the saying is “Make money with others’ people money

 

Rainy Season Starts Early

Rainy season started
It is flooding during the rainy season

The hurricane season starts soon. It is middle of May now, so we have a couple of weeks left till the season starts.

It is not the official rainy season, but we already see a lot of rain. There was no sun during the weekend, it was cloudy, windy. And it was raining nonstop.

According to National Hurricane Center, cloudiness, showers and thun.derstorms were extending over much of the Florida. The system would move slowly over the Florida. Regardless of cyclone formation, the system would cause the rainfall across some parts of Florida over the next few days.

Be carefull while driving in the rain, and do not forget to take an umbrella with you.

When we enjoy Florida sun, we tend to forget the rainy hurricane season. Please be ready and get supplies for hurricane.

 

Happy Mother’s Day!

Blooming orchid
Blooming orchid

Happy Mother’s Day to mothers everywhere – birth mothers, adoptive and foster mothers.

Lets not forget about the grandmothers who are raising their grandchildren. There are single dads who are raising children, so they are doing mom’s and dad’s role.

Orchids to all of you for the love you give each and every day!

But to me, Mother’s Day is every day.

Love, Brigita

 

 

Mortgage Rates Are Leveling Out

Children decorated tiles
Children decorated tiles

Freddie Mac released its’ weekly Primary Mortgage Market Survey on May 10th, 2018:

FreddieMac.5_10_2018.Primary Mortgage Market Survey. US weekly mortgage averages as of 5_10_2018
Freddie Mac – Primary Mortgage Market Survey. US weekly mortgage averages as of 5_10_2018

Freddie Mac‘s survey shows U.S weekly average mortgage rates.

The survey results as of the May 10th, 2018 shows, that 30-year fixed rate mortage did not change during the week and stayed the same as last week 4.55% . But it is 50 point higher from a year ago.

The 15-year fixed-rate mortgage went down by 2 points. It is 4.01% now, when last week was 4.03%.

FreddieMac. 5_10_2018.Primary Mortgage Market Survey.
Freddie Mac – Primary Mortgage Market Survey. Interest Rates.

If you would like to read more about mortgages and interest rates, look into category in my blog Finance and Mortgage category.