Yowza! These days you can get 15-year mortgages for under 2 percent.
There’s a downside to it, though. It’s at least part of what’s fueling rapidly appreciating real estate values. Modest houses in this modest suburban working-class subdivision are fetching $500K. I doubt many of the recent buyers are putting 20 percent down. So they’re paying PMI as well.
I was thrilled when the mortgage rates dropped in the mid 80's and I was able to lock in for 5 years at 10.5%. Real incentive back then to pay it off ASAP. Now there is more incentive to buy up, take on a bigger mortgage as a bigger house means more wealth......at least on paper. My first house cost me $26,500 and some months had to scrape to make the mortgage. Now I live in a modest house that is north of that magical 7 figure mark. But it don't really matter as I am not willing to live in my motor home and given I have to live somewhere til I croak it may as well be here so the dollar figure is pretty much meaningless. The only saving grace is that as I am likely to die before my wife then she will have this asset to sell to pay for the nursing home.