Due to the woes on Wall Street that showed up last week and the fact that Washington has yet to find a solution, interest rates on fixed-rate mortgages jumped after falling for 5 consecutive weeks. Today 9/25/08 Freddie Mac reported that the average mortgage interest rate for 30 year fixed-rate mortgages was 6.09% (6.11% in the southeast), up from 5.78% a week ago. The average interest rate for 15 year fixed-rate mortgages was 5.77%, down from 5.35% last week. A year ago the 30 year rate was 6.42%.
How many of you took advantage of these very low interest rates and low home prices, and finally bought that new home? How many others were still "waiting for interest to reach the bottom"? That is an impossible thing to determine. Even the best stockbrokers cannot predict when a stock has reached it lowest price. They buy when it is "low enough". Then if it goes lower they buyer some more, and on and on. Those home buyers that did not buy last week or lock in a loan rate should check the difference in what they would pay over 30 years using first a 5.78% interest loan and then a 6.09% one. And what will next week bring? Washington lawmakers will greatly influence that.
In the 3rd quarter of this year housing still shows some "softness" in sales and prices. Nationally, in July home prices fell 5.3% from a year before. According to National Association of REALTORs data from August 2007 to August 2008 the median price of existing single-homes (no condos or coops) fell 9.7%. Though the Florida Association of REALTORS saw some bright spots. (See preceding post). Overall seasonally adjusted resales fell 2.2% from July to August.
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