Today 6/25/09 Freddie Mac reported that the average mortgage interest rate for 30 year fixed-rate mortgages was 5.42% (5.36% in the southeast), up from 5.38% a week ago. The average interest rate for 15 year fixed-rate mortgages was 4.87%, actually down from 4.89% last week. A year ago the 30 year rate was 6.45%. One rate went up and one went down. Mostly a wash I would say. Changes that will matter little on your loans.
Interest rates remained relatively unchanged due to very conflicting economic reports concerning the housing market. The sales of existing homes went up for the second straight month, but the median price for them was nearly 17% lower than it was last year. This according to the National Association of REALTORs (NAR). While the sales of existing homes rose, sales of new homes fell 0.6% in May. But their median price was only 3.4% lower than last year. In my opinion, the builders were discounting more aggressively and started doing it way before the average home seller did. That could explain the difference in the median price drops.
Some good news is that the inventory of unsold homes has gone down. Don't you remember me telling you that on several occasions? Here in Zephyrhills, instead of having 30 new listings come on the market each day, now we only have 3 or 4. And with the builders sitting things out for the most part, it only figures that inventory will drop. According to Freddie Mac, the number of existing homes waiting to be sold is 15.3% lower than it was a year ago. And the number of new homes in the inventory was down 35.9%!
Now one more good note. The number of distressed (short sales, foreclosures, abandoned homes) up for sale no only consitute 1/3 of the market as opposed to nearly half of it as recently as March 2009!. That is very good news for the rest of you selling who want to sell your homes and this could help to stablize the prices in the future. Will be nice not to have to compete with 10 foreclosures in your neighborhood.
But do watch those interest rates and do not try to guess when it will be the lowest it can go. No one can predict that. When the rates are "pretty good" and are acceptable to you and your budget, that may be the time to make a move. If you wait to long as you try to anticipate whether rates will go even lower, you are likely "to get caught with your pants down and interest rates up".Trying to avoid that could be what is making some buyers finally get off the fence based on recent interest rates increases.
Do keep in mind that we are a very large country. So figures that come out for the entire nation, may have little or no relevance for your particular area. In the end, it is best if you speak with a local REALTOR or financing expert to see what the situation is for your part of the United States. Florida is not Michigan, nor is Maine the same as California. Market conditions can be very different from place-to-place.
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