I have questions for anyone who has ever purchased a home.
- When did you purchase your first home?
- Do you remember what the interest rate was at the time?
- What was your motivation to buy a home back then?
My twin sister Patty and I purchased our first home in our mid 20's. The newspaper clipping to the right, is the townhome we purchased in the early 80's as first time buyers when we relocated to Northern Virginia from Upstate New York.
Below is a graph from Money Cafe, that shows you what the current interest rates are doing. Believe it or not mortgage rates are at historically low rates.
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Find more information at Money Cafe
Bottom line, interest rates will rise and fall and yet throughout history people still buy and sell homes. Back in the 1980's we were waitresses making a minimum wage of $3.10 an hour plus tips and yet we knew we wanted our own home. We purchased for just under $100,000. We lived in that home for many wonderful years. Today even with the economy the way it has been, that home has more than doubled in price and the current market value is over $250,000! The reality is, if we had kept that home it would be paid off by now.But that's a whole other blog post!
At what interest rate did you buy your first home and what motivated you to purchase a home?
If you are thinking it is time to consider buying a home, the first step is to learn what your buying power is. Markita Aldridge-Woods of Westar Mortgage here in Lake Ridge Virginia has helped many of our clients with getting a home loan Read more here
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Contact Peggy James or Erick Blackwelder of Erick and Company of Exit Choice Realty, Woodbridge VA. Realtors®, call 703-851-3085(Peggy) 703-590-2252 (Office).Give us a call and we can "GET YOUR HOME SOLD FAST"to list your property for sale we service Woodbridge, Lake Ridge, Westridge, Old Bridge Estates, River Falls, Middle County, Manassas,Gainesville, Garrisonville and Triangle area's.Basically all of Prince William County Virginia. Manassas Park, Haymarket,Montclair, Dumfries, Quantico, Fort Belvior, Occoquan, Dale City.
Your title caught my attention right away. It's interesting that you and your sister purchased together. Same with my brother and me when we bought a house together in 1980 at a rate 0f 12%. Later when I got in the business,I sold and my first house the rate was almost 14%. Wow!!
My wife and I just paid off our house but borrowed money to remodel and it was only 4.2%. What a wide range!!!
When did you purchase your first home? When I was 24 years old - 1990. I bought it with my best friend.
Do you remember what the interest rate was at the time? Yup, a whopping 11.06%. What were we thinking?
What was your motivation to buy a home back then? We wanted to pay a mortgage instead of rent, and we had both just gotten full-time jobs after years of university so we thought we were set. We paid through our nose for a long time. She ended up getting engaged and wanted to buy my half out, so I let her.
I learned a lot from that experience, and I don't regret it, but I cringe when I think about what our mortgage payments were. You make a good point, Peggy, that regardless of what happens with interest rates, people continue to buy and sell homes.
Hi Russell. Thanks for dropping in to comment today.
My sister and I purchased together because it was the only way we could afford to buy a home at the high interest rates at the time. Back then our payment was just shy of $1200 a month with taxes and insurance. Today that same townhome at more than double the price is a few hundred dollars more than what we paid.
Tanya, thank you for commenting. I love you said you at 11.06%. And I'll bet you thought you snag a great rate! The point of my post is to share with home buyers, work with a Realtor to find a home that is right for your lifestyle,that fits your needs and wants for the long haul. Secure the best rate available at the time and love the home you buy.
What I have noticed is most home buyers we have been working with, are able to afford the home they really want due to current historically low interest rates. Opportunity is knocking for those who have good credit and the motivation to purchase a home.
We bought our first home in Kings Park in Springfield VA when the prevailing interest rate was 17%. However we were able to use a VA loan "wrap" to bring the interest rate down to 12%. It seemed like such a baragin. Last week I negotiated a new interest rate on my current loan to....drum roll please....3%.
Peggy buying that first home with you was one of the best decision I ever made. Yes we had our parents and ever one else saying giving us their two cents on what we should do . I remember our parents who lived in upstate NY thinking we were buying a southern plantation for 100,000! So funny when they came and saw it was a townhome. In the end it we did what we wanted to do it was our decision.
We searched and found the best value for our lifestyle at the time, we found a Realtor we could trust to help us and a loan officer to coach us on our options and price range. Even with the high interest rate we had a wonderful tax write instead of paying rent at age 24 . When we sold it after Realtor fees I remember we each had 5600.00 to use towards our next home. Buyers today seem to have the best of all worlds record low interest rates and low prices on homes. So many will be saying I should have or I could have if they miss this window in time.
Hey Cindy thanks for stopping in to comment today. Today's buyers are probably shocked to read that people actually purchased homes at such high rates. I think you win the prize for that purchase. Regarding your comment about your re-negotiated rate. Fantastic! Now that is a savings worth talking about!
My first home was in 1982 at around 12% can't recall exactly. We moved up from a trailor on land (which my husband had already owned when I met him) to a real house. Ours was a construction to permanent loan so was higher than just a straight purchase. We still felt it was a good investment since we would own it, and it would continue to increase in value. We built, remodeled several homes after that, and when we divorced we owed only $60,000 on the current property we were in. Our original goal was to buy, remodel, sell and keep moving up to no mortgage at all, toward retirement. The divorce ended that, lol. But he sold the house with about $60,000 profit. It was still an adventure!
My husband and I bought our first home in 1988 at 12% with a va loan Kenny was army. At the time we thought it was fab! We wanted to buy because we knew kenny would retire here in virginia. We also didn't want to pay rent anymore and we wanted to start a family. Even though I moved out after 10 yrs my ex still lives in the house which has been re-financed several times.
Hi Peggy,
Hard to think back that far...LOL! My road to home ownership started with my ex husband, who was stationed at Norfolk Navel Air Station in the early 80's. Our newly-built condo property was located at "Whilloughby Spit" right on the Chesapeake Bay, just before the Hampton Roads Tunnel. It was a beautiful view, but in a "transitional" area" which allowed more house bang for the buck...as opposed to living closer to Virginia Beach. I can't recall the original purchase price, but I believe the VA loan had an interest rate around 14%! Amazing to think about now! And here I am...six home purchases/sales later...(with your fantastic help in selling "home five" in Lake Ridge)...50 years old...and living on 16 acres in Charlottesville with my wonderful husband, love of my life...and NO MORTGAGE!
Patty- I agree. I think home buyers will look back and say " I should have purchased when interest rates were under 5%".
Myrtle- I would say a lot of people think the wild ride from 2005 until 2008 was more than they bargained for however as we can see from this post, so many people purchased homes when the interest rates were unthinkable!
Jillian- you bring up a great point. Any homeowner who has owned their home for a decade or longer may want to consider refinancing. Look at all your options, consider how much longer you will be in your home Consult a loan officer and Realtor is you have questions.
Elizabeth- thanks for commenting. 14% WOW...you get 2nd prize behind Cindy above. It was a pleasure to help you with the sale of your home. However, when one chapter ends, another begins. 16 Acres in Charlottesville with no mortgage and the love of you life sounds like Heaven!
Peggy,
My ex-husband and I bought our first home in Pimmit Hills in 1984, a single family (880 square ft) home for $71,000.00 at, I believe, about 14% interest! We sold it three years later for $101,000.00 and thought we had made a killing! We then bought a townhouse in Burke for $125,000.00. I think the interest rate was about 12% or so at that time. We bought because we could and didn't want to throw our $$ away renting. I can remember that our agent had to go to the house and "fight" with others to get the owner to accept our bid! People were actually fighting over that house! :-) I'm happy to say that I now have my third house (but one that I bought BY MYSELF) with your help at a much lower interest rate for sure!!!!
My first home was a VA assumption at 5.75% which was considered unbelievable. My 2nd home as 10%...which was also considered a great rate at that time. That was in 1978!!