How can rising mortgage interest rates be a good thing?

Why Have Interest Rates Jumped to a 7-Year High?

Interest rates for a 30-year fixed rate mortgage have climbed from 3.95% in the first week of January up to 4.61% last week, which marks a 7-year high according to Freddie Mac. The current pace of acceleration has been fueled by many factors.

Sam Khater, Freddie Mac’s Chief Economist, had this to say:

“Healthy consumer spending and higher commodity prices spooked bond markets and led to higher mortgage rates over the past week.

Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.”

But what do gas prices have to do with interest rates?

Investopedia explains the relationship like this:

“The price of oil and inflation are often seen as being connected in a cause-and-effect relationship. As oil prices move up or down, inflation follows in the same direction.”

You may have noticed that filling your gas tank has become substantially more expensive in recent months. The average national gas price has climbed nearly $0.50 from the beginning of the year, leading to the highest price for Memorial Day weekend since 2014.

As rates go up, your purchasing power goes down, but don’t worry; rates are still well below the averages we’ve seen over the last four decades.

“Freddie Mac said this year’s higher rates have not yet caused much of a ripple in the strong demand levels for buying a home seen in most markets, but inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.”

Buying sooner rather than later will help lock in a lower rate than waiting, as the experts believe rates will continue to climb. Even a small increase in interest rates can have a big impact on your monthly housing cost.

Bottom Line

If you are planning on buying a home this year, keep an eye on gas prices the next time you’re at the pump. If you start to feel a big jump in price, know that rates are probably on their way up, too.

Not sure if you should try to sell your home now? Here are 4 reasons to do it!

4 Reasons to Sell This Fall [INFOGRAPHIC]

Some Highlights:

• Buyer demand continues to outpace the supply of homes for sale! Buyers are often competing with one another for the listings that are available!
• Housing inventory is still under the 6-month supply that is needed for a normal housing market.
• Perhaps the time has come for you and your family to move on and start living the life you desire.

First Fridays are back!

Downtown Libertyville is the place to be tonight! Good food, entertainment, sales & local artwork on display. The weather is not bad either!  For a list of participating business and their specials, click HERE

 

SWALCO opens new electronic recycling sites

Is clearing out your home's clutter one of your New Year resolutions?  If so, I am sure that you have an old computer, laptop, printer or even a fax machine hidden away somewhere.  Do you know that there are certain electronic items that may not be disposed of in a landfill?  If not, you aren't alone.  Most people are not aware that, since 2012, Illinois law prohibits printers, scanner, televisions and computers from being "tossed out with the trash."  SWALCO of Lake County opened up new collection facilities, as of January 2, 2015.  For a list of accepted items, hours & locations, please click here

New Drop-off Locations:

Antioch: Waste Management North	22333 Route 173, Antioch, IL Monday - Friday: 7:30 a.m. - 2:30 p.m. Excluding holidays.
​Grant Township: Road District Facility	26535 Molidor Rd., Ingleside, IL Monday - Friday: 9:00 a.m. - 3:00 p.m. Excluding holidays
​Grayslake: Public Works Facility, Recycling Center	585 Berry Ave., Grayslake, IL Monday - Friday: 7:00 a.m. - 3:30 p.m. Saturday: 8:00 a.m. - 12:00 p.m. Also accepts: Cardboard, mixed paper, household containers, shoes, clothing and textiles
​Highland Park: Firearms Training Center	1180 Half Day Rd., Highland Park, IL Every Tuesday: 7:00 a.m. - 1:00 p.m. 1st Saturday of the month 7:00 am - 1:00 pm Excluding holidays Also accepts: Fluorescent light bulbs, foam containers, foam packaging materials, clothing and textiles
​Wauconda Township: Road District Facility	​505 W. Bonner Rd., Wauconda, IL 1st Saturday of the month: 9:00 a.m. - 12:00 p.m. Monday - Friday 7:00 am - 3:30 pm Excluding holidays Also accepts: Fluorescent light bulbs
​Waukegan: Public Works Facility	​1700 McAree Rd., Waukegan, IL Monday - Friday: 7:30 a.m. - 4:00 p.m. Excluding holidays Also accepts: Clothing and textiles