Lower Interest Rates Open Up Loft Market By Making Your Loan Dollars Go Farther

Lower interest rates increase you home purchase dollars

The Douglas Building is a spectacular presence on the corner of Third and Spring Streets in this historic Downtown neighborhood. The Douglas Building is the legacy of T.D. Stimson, (1827 – 1898) a lumber baron turned real estate mogul who fostered commercial development in Los Angeles during the 1890s. As one of the few remaining vestiges of Los Angeles’ 19th century architectural treasures, the Douglas Building still stands out, bold and elegant in the midst of glass and steel.

Rising home prices have many concerned that the average family will no longer be able to afford the most precious piece of the American Dream – their own home.

However, it is not just the price of a home that determines its affordability. The monthly cost of a home is determined by the price and the interest rate on the mortgage used to purchase it.

Today, mortgage interest rates stand at about 4.5%. The average annual mortgage interest rate from 1985 to 2000 was almost double that number, at 8.92%. When comparing affordability of homeownership over the decades, we must also realize that incomes have increased.

This is why most indexes use the percentage of median income required to make monthly mortgage payments on a typical home as the point of comparison.

Zillow recently released a report comparing home affordability over the decades using this formula. The report revealed that, though homes are less affordable this year than last year, they are more affordable today (17.1%) than they were between 1985-2000 (21%). Additionally, homes are more affordable now than at the peak of the housing bubble in 2006 (25.4%). Here is a chart of these findings:

Monthly Mortgage Payments as a percentage of income

What will happen when mortgage interest rates rise?
Most experts think that the mortgage interest rate will increase to about 5% by year’s end. How will that impact affordability? Zillow also covered this in their report:

Monthly Mortgage Payments as percentage of median Income

Rates would need to approach 6% before homes became less affordable than they had been historically.

Bottom Line
Though homes are less affordable today than they were last year, they are still a great purchase while interest rates are below the 6% mark.
#Lots #interestrates

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Even with rates going up your opportunity to invest still makes sense.

Freshly painted 700 Sq. ft. loft in the historic Douglas Building in the heart of Downtown Los Angeles!! Loft is bright and welcoming with large oversized windows, 11 foot ceilings, exposed brick walls, and hardwood flooring. Kitchen includes Bosch appliances, granite counters, and Poggenpohl cabinets! Brand new washer and dryer in unit! Rent includes gas, water, and trash. Parking not included. The Douglas Building is home to the acclaimed restaurant Spring on ground level and conveniently located near Grand Central Market, Blue Bottle Coffee, Walt Disney Concert Hall and so much more!!! Don’t miss this great loft in prime Downtown LA location!

Copyright © This free information provided courtesy L.A. Loft Blog and LAcondoInfo.com with information provided by Corey Chambers, Realty Source Inc, BRE#01889449 We are not associated with the homeowner’s association or developer. For more information, contact (213) 880-9910 or visit LAcondoInfo.com  Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.

Vital Downtown Los Angeles Neighborhoods Embraced By Robust Tech Industry

Buyer's Agents Feel Squeeze of Technology
Technology Industry Brings Boom in Funding to Downtown Los Angeles

Tech companies and startups in downtown Los Angeles are growing in number and size. What makes DTLA a great place to work?   Until recently, Silicon Beach was where a tech startup needed to be to have access to the resources necessary for success. That’s all started to change, and DTLA has become one of the premier spots in LA attracting new tech companies.

Recently the value of the business in DTLA tech ventures reach a top ten standing among rival Southland areas.  Companies located here brought in a whopping $96 million over the last year, beating neighborhoods like Marina Del Rey in the process.  Downtown Los Angeles gives it’s resident companies more clout.  Its central location is great for talented individuals in search of a more convenient commute. The city core has enhanced its offerings so much in recent years and the fact that many other tech companies operate nearby is a testament to this neighborhood. Tech workers and their companies like being associated with DTLAs new identity as a progressive neighborhood moving forward and making things happen.

Besides the convenience of the Metro and Shopping, you really can’t beat being in the heart of Downtown LA with a pulse entirely different city from the rest of Los Angeles. So much of it is walkable and there are tons of options for food and activities that we feel spoiled for choice.  Downtown LA is a major contributor to residential growth as well.  With so much to offer technology workers are looking to plant roots in the heart of the city,  As businesses flock to the area, DTLA has become an important cultural community in LA County. With a number of the world’s finest restaurants, bars and breweries, the area is no longer just a place to get your work done.  It has become a great place to live.

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1100 Wilshire Boulevard
Centrally located Lofts and condominiums offer technology workers homes close to the industry action in DTLA

Copyright © This free information provided courtesy L.A. Loft Blog and LAcondoInfo.com with information provided by Corey Chambers, Realty Source Inc, BRE#01889449 We are not associated with the homeowner’s association or developer. For more information, contact (213) 880-9910 or visit LAcondoInfo.com  Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.