One of the biggest factors in the real estate market is the interest rate - specifically in the traditional 30 years fixed rate mortgage.  While there are many types of loans available, the 30 year fixed seems to be the benchmark. 

So far in 2015, our average interest rate through May is 3.73.  This compares with 2014 at 4.17% and 2013 at 3.98%. We have been experiencing an unprecedented run of low-interest rates.  Annual average interest rates have remained under 6% since 2008. Many folks think that single digit interest rates are here to stay.  I remember the days when you were lucky to get 10%.  Back in 1990, the average rate was 10.13% and in 1980 13.74%.  The real spike occurred in 1981 with an average of over 16%.

So why talk about all of these numbers?  I believe that history is important and we only fools ourselves if we think that we can't learn from what's happened in the past.  Conventional wisdom says we are in an environment where interest rates are trending up.  Just because we haven't seen it yet, doesn't mean it's not coming.  

I don't expect to see the skyrocketing interest rates but conversely, I don't see interest rates plummeting.  I do believe that if you are considering making a move to purchase real estate, now is the time to lock it in.  There appears to be a good window of opportunity.

There are a few reasons why I think this is a good time to buy.  Real estate demand here continues to be high.  We have a strong local market for full-time residents and a continuing trend of second home/vacation home buyers looking for a place to stay while visiting.  Many of these buyers plan to use this second home as their primary retirement residence.  Maui also has a limited inventory in a limited geography.  Basically, if you want to buy Maui you have only what's available on the island.  There are no suburbs or places "just a short drive away".  This means that buyers are looking at the properties for sale and finding something they can make work even if it may not be exactly what they want.  And the nice properties and deals don't last long.  

 

All of these factors combined with current low-interest rates and the anticipated rise in interest rates make now an excellent time to make the move.