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"Where as the prospect of your mortgae going lower is higher at...

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lispingduck

7,180 Posts.

07/11/17

22:10

Post #: 28585350
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Originally posted by lispingduck ↑

Its rather simple skip. If prices fell 25-35% mortgages would likely be 25-35% less. The saving/deposit first home buyers have will allow them to purchase a better property than they otherwise would.

Its better to have a 750k mortgage at 8% than $1m at 4%. Why? because you are more likely to see the 4% go up to 8% some time in the future than the 4% go 2%. The risk that your mortgage interest payment goes up is higher at 4%. Where as the prospect of your mortgae going lower is higher at 4%. You starting to see the benefits to FHB?

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"Where as the prospect of your mortgae going lower is higher at 4%."

Sorry, that should read higher at 8%.
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