Mortgages are low cost loans because of low interest rates

People who can get the financing can benefit from low interest rates on home loans by getting inexpensive loans. Rates for 30-year fixed, 15-year fixed and five-year adjustable mortgage loans are beginning to slip again after housing data indicates growth has stalled in real estate. However, many see doom and gloom on the horizon. Analysts think a double dip in housing is soon to occur.

Getting a house means a steal

The demand for housing is going down still meaning market rates for home loans are going down. Buyers who are eligible may be able to get some seriously inexpensive loans. The five-year adjustable rate mortgage, ARM, went from 3.80 percent down to 3.72 percent. MSNBC reports that arms are as low as they will get. The five year ARMS have really gone up from Feb. when they were at 3.23 percent. The average rate for a 30-year fixed mortgage hit 4.87 percent, more than the rate observed in November, when 30-year fixed mortgage loans hit a 40-year low of 4.17 percent. Currently, 4.15 percent is what a 15 year fixed mortgage costs.

Possibly even double dip

It is possible that a double dip might take place for the housing market. CNN states the possibilities of this happening. Purchasing a house will always cost more than a cash advance can give. Nevertheless, the housing market may get even worse hurting the real estate industry more than ever. The house costs might end up "falling another 15, 20 or 25 percent," according to Robert Schiller. Shiller co-founded the Case-Shiller Index. Since the 2008 crash, housing prices are at the lowest rate ever. It doesn't seem extremely hard for a double dip to occur. If it were to happen, it could mean further bad news for an already shaky economy. Since states rely partially on property taxes, lower values mean lower revenues and that would lead to more states having serious spending budget woes.

Why you need to rent

Since the latest recession started in the housing industry, it has called into question whether it is better to rent or purchase. If an individual buys a house when the value is down and pays it back when the value is high, then it could be worth it to buy a home. When putting in lots of equity or having paid off the mortgage, it is even a better investment. However, renters pay no property taxes and have to do little, if any, maintenance. Granted renting means; having to part with more instant cash each month than a homeowner.

Citations

MSNBC

msnbc.msn.com/id/38770102/ns/business-real_estate/

CNN

money.cnn.com/2011/03/03/real_estate/housing_buy_or_not/index.htm