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Home › Forums › Housing › >1% interest SPIKE = 10% house price drop?

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  • February 14, 2011 at 10:22 AM #667228
    UCGal
    Participant

    So home loan prices are going up… when will interest rates go up for savers? CD rates are beyond suckful… as are money market, etc..

    Sorry… I’ve got a low home mortgage rate already – so I’m looking for improved interest payment rates on savings.

    February 14, 2011 at 3:41 PM #666324
    Doofrat
    Participant

    An easy rule of thumb is:
    The % change in payment (at least the interest part) is directly proportional to the % change in interest rate. So if rates are 4% and you raise the rate 1%, that’s a 25% increase in rates and a 25% increase in the interest payment.
    If you go from 4% to 8%, that’s 100%, so your payment effectively doubles.
    At least that’s what I figured out, if I’m wrong, feel free to flame me.

    February 14, 2011 at 3:41 PM #666386
    Doofrat
    Participant

    An easy rule of thumb is:
    The % change in payment (at least the interest part) is directly proportional to the % change in interest rate. So if rates are 4% and you raise the rate 1%, that’s a 25% increase in rates and a 25% increase in the interest payment.
    If you go from 4% to 8%, that’s 100%, so your payment effectively doubles.
    At least that’s what I figured out, if I’m wrong, feel free to flame me.

    February 14, 2011 at 3:41 PM #666990
    Doofrat
    Participant

    An easy rule of thumb is:
    The % change in payment (at least the interest part) is directly proportional to the % change in interest rate. So if rates are 4% and you raise the rate 1%, that’s a 25% increase in rates and a 25% increase in the interest payment.
    If you go from 4% to 8%, that’s 100%, so your payment effectively doubles.
    At least that’s what I figured out, if I’m wrong, feel free to flame me.

    February 14, 2011 at 3:41 PM #667128
    Doofrat
    Participant

    An easy rule of thumb is:
    The % change in payment (at least the interest part) is directly proportional to the % change in interest rate. So if rates are 4% and you raise the rate 1%, that’s a 25% increase in rates and a 25% increase in the interest payment.
    If you go from 4% to 8%, that’s 100%, so your payment effectively doubles.
    At least that’s what I figured out, if I’m wrong, feel free to flame me.

    February 14, 2011 at 3:41 PM #667465
    Doofrat
    Participant

    An easy rule of thumb is:
    The % change in payment (at least the interest part) is directly proportional to the % change in interest rate. So if rates are 4% and you raise the rate 1%, that’s a 25% increase in rates and a 25% increase in the interest payment.
    If you go from 4% to 8%, that’s 100%, so your payment effectively doubles.
    At least that’s what I figured out, if I’m wrong, feel free to flame me.

    February 14, 2011 at 6:45 PM #666363
    Doooh
    Participant

    Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.

    February 14, 2011 at 6:45 PM #666425
    Doooh
    Participant

    Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.

    February 14, 2011 at 6:45 PM #667030
    Doooh
    Participant

    Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.

    February 14, 2011 at 6:45 PM #667167
    Doooh
    Participant

    Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.

    February 14, 2011 at 6:45 PM #667505
    Doooh
    Participant

    Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.

    February 14, 2011 at 7:43 PM #666373
    an
    Participant

    [quote=Doooh]Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.[/quote]
    There were several times in 2009 that rates went up by about .5% w/in 1 month, yet, we didn’t see a drop of 5% in home price. On the contrary, it was a steady rise throughout 2009. In 2008, there were a couple of periods where rates went down by about .5% w/in 1 month, yet, we didn’t see an increase of 5% in home price. Are you saying 1% is somehow the threshold?

    February 14, 2011 at 7:43 PM #666435
    an
    Participant

    [quote=Doooh]Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.[/quote]
    There were several times in 2009 that rates went up by about .5% w/in 1 month, yet, we didn’t see a drop of 5% in home price. On the contrary, it was a steady rise throughout 2009. In 2008, there were a couple of periods where rates went down by about .5% w/in 1 month, yet, we didn’t see an increase of 5% in home price. Are you saying 1% is somehow the threshold?

    February 14, 2011 at 7:43 PM #667040
    an
    Participant

    [quote=Doooh]Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.[/quote]
    There were several times in 2009 that rates went up by about .5% w/in 1 month, yet, we didn’t see a drop of 5% in home price. On the contrary, it was a steady rise throughout 2009. In 2008, there were a couple of periods where rates went down by about .5% w/in 1 month, yet, we didn’t see an increase of 5% in home price. Are you saying 1% is somehow the threshold?

    February 14, 2011 at 7:43 PM #667177
    an
    Participant

    [quote=Doooh]Your examples were based on years of change. The reality of the current example we’re in was based on 1 month. Let me repeat it again… 1 month and the 30 year saw a 1% increase!

    The examples you presented are irrelevant to the reality we’re sitting in this month.[/quote]
    There were several times in 2009 that rates went up by about .5% w/in 1 month, yet, we didn’t see a drop of 5% in home price. On the contrary, it was a steady rise throughout 2009. In 2008, there were a couple of periods where rates went down by about .5% w/in 1 month, yet, we didn’t see an increase of 5% in home price. Are you saying 1% is somehow the threshold?

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