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Real Estate

SHOP AROUND

Bank mortgage rates

determined by market

HOW MANY times have
you heard that mortgage in-
terest rates are down, and
going down further?

How mak:y times have you
heard that they have
stabilized? While you’re
counting, how about the
number of pessimists you’ve
heard discussing when we'll
face a new round of higher
interest rates.

Confused? Welcome to a
larger, and growing, group.
Even the professionals
disagree, and admit they re-
ally have not got the answer
to the question on any home
buyer’s mind — ‘‘What rate
shall I take, and for how
long?”

“The truth is nobody real-
ly knows what will happen,’’
said Robert Keller, senior
vice-president, lending at
National Trust.

“Rates are determined by
market forces, and although
there is variation and a hore

“buyer should shop. around

for the very best rate, he
should consider a number of
other variables as well,’’ said
Keller.

While one year rates are
now available under .10 per
cent, terms of three, four
and. five years can: also be
found for less.than I] per

“: cent. National Trust, for ex-
ample, currently -has terms

of three, four and five years
available at 10'’4 per cent to
11 per cent. The home buyer
is now faced with the
dilemma of choosing.

“What worries most peo-
ple,’’ said Keller, ‘‘is that
rates will go down even more
and that they will be locked
in at what will then seem like
an unacceptably high rate
of, say, 11 per cent. This ra-
tionale misses the point~‘to
some extent.””

Keller pointed out that
corsumers should ask
thenselves how far they
think interest rates can
possibly fall, and balance
that figure against how far
they think those rates could
rise over a given period.

“The interesting thing,’’
noted Keller,
people think interest rates

“may fall perhaps another 1 -
' t% percentage points at the
most. However, they believe -
could con- -

interest rates
ceivably rise again as much
as six or even eight percent-
age points.

“That sort of upside risk
is an enormous gainble,”
Keller said.

The impact of that gamble
on the family budget can be
quickly calculated. For ex-
ample, a family with a mon-

.thly gress income ¢f $2,000

can budget $600 per month

“is that most’

for mortgage payments (in-
terest, principal and taxes)
based on using 30 per cent of
gross income for mortgage
costs. This family could af-
ford a $52,000 mortgage at
11 per cent.

For purposes of il-
lustrating however, assume
that the family purchased a
house which required a
$43,000 mortgage. Look at
the different options
available at various interest
rates: (all figures based on a
25-year amortization)

Monthly I & P Payment
l-year term @ 9.50%
$370.23

term @10.25%
$391.73

2-year

term @10.50%

5-year
$399.04

This family could live
comfortably with any of
these payments, and in fact
there is not much dollar dif-
ference per month between a
9.5 per cent rate and a 10.5
per cent rate. If rates do fall,
but only by the expected one
or 1% percentage points, the
potential upside benefit for

See Calculate
Peso 67

‘A Luxury ‘Waterfront Estate of
_Uncompromising Quality

: : SEE WHAT $289, 000 WILL BUY Ar ROCKWOOD ESTATES ‘
: Now being built this Downs - Archambault custom design 2200 sq.ft. rancher, 2 large bdrms, 2 full &

' 61- Friday, April 24, 1987 - North Shore News

‘e

DREAMS COME TRUE
Swim & boat from your own dock or make a
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pictures and info. p
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NORTH AMERICA’ AS fina REAL ESTATE MARKETING SYSTEM.

CINDERELLA!

OPEN SUNDAY 2-4 P.M.

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Bring your mop, paintbrush and magic wand and
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TRUDIE CARLSON 921-9949

CITY LIVING, COUNTRY PRICE
Quality atounds in this spacious unit. Huge kit-
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TRUDIE CARLSON 921-9949, 988-3151

26. LEGAL 4-PLEX
$249,900. Great lower Lonsdale location. 4-2
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increase.
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WAYNE D. KOROL. 922-9237

’ SERENE NATURE

116 acres of land located near Stuart Lake, B. Cc.
A great place to relax and enjoy fishing and fresh
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today.
CHRIS BUCK 980-0575.

. ensultes, sunken faraily rm & living rm, breakfast nook with bay windows..°

¢ Waterfront - West Vancouver's First Exclusive Waterfront Estate.
4.8 acres - only 16 custom designed & quality built detached

homes. , . . <7 A NS
© Whlkiag Distance to the Beach, Golf Course, Tennis, Boat fe} : 2 Pb,
Moorage & miles of forest trails. a v ]
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Full price $5,750. Assessed over
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3
NEW HOMES
4 UNDER
| CONSTRUCTION

S  ¢ Valor - These spacious detached homes with all the above
amenities for lets than competitive detached or cluster homes.
© Freedous of choice, use our Downs Archumbault designs and have
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© Uldmate in strate ttle fiving - 16 freehold owners enjoying the Bi
fe 86 setting and amenities without the upkeep responsibility.
B © Located on the waterfront at Batchelor Bay, 6900 Marine Drive [i
= only 10 minutes to Park Royal - 25 minutes to Vancouver.

Become Part of West Vancouver’s
Most Unique Housing Concept

Open Sat. & Sun. 1-5 or by appt.
Contact

ROCKWOOO ‘IVAR FOSSEN
oft. 294-1771, Per. 680-4521
‘Home 926-0473 |

NACEL PROPERTIES LID.

FOR YOUR FUN
ON THE SUNSHINE COAST
Bright and roomy, 2 bedroom end unit at the Jolly
Roger. 40’ moorage available. Swim pool, great
ocean views from this one level accommodation.
Fully furnished — D/W, TV, FIP. All info. with
MARY GASTON 929-3512
MARGERY BACH 929-4470

6741 DUFFERIN WEST VANCOUVER