Short-Term vs. Long-Term Interest Rates

The Federal Open Market Committee (FOMC) meets eight times per year to determine increases and decreases in the target Federal Funds Rate. The current target is 1.75% to 2.00%. The FOMC regulates this rate by controlling the amount of currency available in the US economy. The more money available in the marketplace, the faster the … Continue reading Short-Term vs. Long-Term Interest Rates

Are we in a housing bubble?

Market conditions suggest that Portland is better positioned than other major cities on the West Coast. As you can see, Portland is still the least expensive major market on the West Coast. And the Home Affordability Index (HAI)—calculated by the National Association of Realtors (NAR)— is also lower than any city besides Sacramento. A value … Continue reading Are we in a housing bubble?

The Financial Benefits of Homeownership

Homeownership provides financial benefit in four areas: Monthly cost difference between renting and owning Appreciation in home value Equity growth over time as loan balance is paid down Tax benefit from the deductibility of mortgage interest The information below is based on historical data for the Portland Metro Area and assumes a 4% appreciation rate, … Continue reading The Financial Benefits of Homeownership

Four Reasons to Buy Investment Real Estate

Tax Benefits* There are limited tax benefits for middle-class Americans. Rental real estate has two tax benefits that can provide tax-free income to investment property owners and a tax-free windfall to heirs. Owners can depreciate residential rentals over 27.5 years. The depreciation can be used to offset rental income; meaning owners can receive rent from … Continue reading Four Reasons to Buy Investment Real Estate

Is an Accessory Dwelling Unit (ADU) Right for You?

Accessory Dwelling Units (ADUs) are also known as: Ohana Unit (Hawaii) Granny Flat Mother-in-Law Unit In-Law Suite Grand Retreat Homeowners Build ADUs for Many Reasons: Long-term rental: supplemental rental income Short-term rental: Airbnb and VRBO short-term rentals can generate much higher rent than monthly rentals, but require more time to manage Age in Place: Elderly … Continue reading Is an Accessory Dwelling Unit (ADU) Right for You?

In Portland, It Now Costs As Much to Rent As to Buy!

According to Rent Jungle, the average rent for a two-bedroom apartment in Portland is $1821 per month. The monthly mortgage payment on a $300k home purchased with five percent down falls within the same monthly payment range. By the time you factor in the tax savings associated with the mortgage interest deduction, the net monthly … Continue reading In Portland, It Now Costs As Much to Rent As to Buy!

Two Factors That Impact Your Mortgage More Than Interest Rates

Most home buyers have been trained by the media to be highly focused on interest rate. As you will see below, changes in interest rate have less impact than purchase price and property taxes. Property taxes and purchase price have the largest impact on monthly payment, interest rate typically comes third, and homeowner’s insurance has … Continue reading Two Factors That Impact Your Mortgage More Than Interest Rates