Today 2/28/08, Freddie Mac reported that the average mortgage interest rates for 30 and 15 year fixed-rate loans moved upward again. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.24% (6.22% in the southeast), up from 6.04% a week ago. The average interest rate for 15 year fixed-rate mortgages was 5.72%, up from 5.64% last week.
Again, these do not appear to be insignificant increases. Not so long ago rates were below 6%. At that time I predicted that we were reaching a low spot and that there might not be much more of a decrease at that point. Unfortunately, I was correct and rates have gone up now for several weeks, though they are still pretty low historically speaking. Home prices continue to be low. Those people who bought and financed a home purchase a month ago got a good break on interest rates and on their prices.
The surge in refinancing that took place while rates were low in January 2008 will likely subside unless the rates begin to reverse their recent trend and begin to drop again. The Federal Reserve is hinting at further interest rate cuts in March.
At the same time the US Commerce Department is reporting that the economy nearly came to a stop in the latter part of 2007. Annual economic growth was just 2.2%, the lowest in 5 years.
Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.
If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.
If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be, should you decide to finance a home purchase.
John Elwell - REALTOR
Bill Nye Realty, Inc.
Licensed in Florida