July 4, 2008

Freddie Mac: Mortgage Rates Reverse Trend and Fall

Momentary Relief

30-year fixed-rate mortgage: Averaged 6.45 percent with an average 0.6 point for the week ending June 26, 2008. Last year at this time, the 30-year FRM averaged 6.67 percent. The last time the 30-year FRM was higher was the week ending September 6, 2007, when it averaged 6.46 percent.

The 15-year fixed-rate mortgage: Averaged 5.92 percent with an average 0.6 point. A year ago at this time, the 15-year FRM averaged 6.30 percent.

Five-year Treasury-indexed ARMs: Averaged 5.78 percent this week, with an average 0.7 point. A year ago, the 5-year ARM averaged 6.29 percent.

One-year Treasury-indexed ARMs: Averaged 5.17 percent this week with an average 0.6 point. At this time last year, the 1-year ARM averaged 5.71 percent.

A secular change in the direction of the Feds focus from housing and lower rates is going to be high cost of money likely offset by lower home prices . If you want to sell and you have a willing buyer, you may have to sell at a lower price to help that willing buyer into your property. The rate drop this week is due to the Feds statement that they expect to see inflation lower by years end. These weekly changes are tidbits of relief, but the general trend for prices is still down. Industry leaders keep pushing the recovery date further out and now many think it will be 2010 before we see falling prices start to entice willing buyers

Thanks for Reading

Howard Bell
A web site of over 450 articles related to real estate focused primarily on property management.

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