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BobPhillips-RE
Posts: 1,701
Registered: ‎12-13-2010
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Re: Weekly unemployment claims fall to lowest level in 4 years

[ Edited ]

""There's no place like home.", especially when it's your own, and the interest rate is less than 4%!

 

Posted on April 13, 2012 by Bob Phillips

 

Freddie Mac Mortgage Rates

 

After a brief surge north of 4 percent last month, mortgage rates have settled down, near their lowest levels of all-time.

 

According to Freddie Mac’s weekly Primary Mortgage Market Survey, for applicants willing to pay 0.7 discount points plus a complete set of closing costs, the average 30-year fixed rate mortgage rate fell to 3.88 percent this week.

 

Mortgage rates are down this week on “safe haven” buying. The move is triggered by Wall Street’s concern that Spain and Italy will have trouble servicing their respective sovereign debt. In response, investors are selling risk-heavy assets and using the proceeds to purchase U.S. government-backed bonds.

 

This creates demand for mortgage bonds which, in turn, pressures mortgage rates lower.

 

The storyline is similar to what transpired in Greece last year, and, at least for now, it gives Trabuco Canyon home buyers reason to cheer. So long as economic uncertainty remains, mortgage rates may stay low.

 

Of course, like all things in real estate, though, mortgage rates are local. Rates offered by banks varied by region.

 

Freddie Mac’s survey of 125 banks showed the following regional breakdown :

  • Northeast Region : 3.88% with 0.8 discount points 
  • West Region : 3.85% with 0.8 discount points
  • Southeast Region : 3.91% with 0.8 discount points
  • North Central Region : 3.89% with 0.6 discount points
  • Southwest Region : 3.90% with 0.8 discount points

Relative to history, though, all mortgage rates look inexpensive. Conforming 30-year fixed rate mortgage rates have never been as low as they are today. It’s a bonus for home buyers because cheap mortgage rate yield cheap mortgage payments. Home affordability remains near all-time highs.  

 

If you’re unsure of whether now is a good time to buy or refinance, the answer is yes. Talk to your loan officer to review your mortgage options.  I have a couple of great ones I would happily recommend.


All this, of course, is merely MY opinion. Thanks for reading.

Bob Phillips - Realty ONE Group - South Orange County, CA
Redfin Open Book Certified
LoansbyJW
Posts: 3,202
Registered: ‎04-30-2009

Re: Weekly unemployment claims fall to lowest level in 4 years

Then again, if unemployment / underemployment remains an underlying factor in buying, the rate for a mortgage is meaningless.

 

A $500,000 priced home with 20% down at an average rate of 3.875% has an "all in" payment of $2,547

 

With a 5% property value decrease ($475,000) and a 1/2 percent increase in rates (4.375%) the payment is $2,530.

 

A higher price is not guaranteed to remain stable. A higher rate can often be refinanced. 

 

Thanks for reading,

John Wheaton NMLS 653018 | Redfin Open Book Recommended Lender
See all my reviews
Gold Contributor
BobPhillips-RE
Posts: 1,701
Registered: ‎12-13-2010
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Re: Weekly unemployment claims fall to lowest level in 4 years

JW stated:  "A $500,000 priced home with 20% down at an average rate of 3.875% has an "all in" payment of $2,547

 

With a 5% property value decrease ($475,000) and a 1/2 percent increase in rates (4.375%) the payment is $2,530."

 

Care to wager on the chances of a 1/2% increase in rates happening before a further 5% drop in housing prices in Orange County?

All this, of course, is merely MY opinion. Thanks for reading.

Bob Phillips - Realty ONE Group - South Orange County, CA
Redfin Open Book Certified
LoansbyJW
Posts: 3,202
Registered: ‎04-30-2009

Re: Weekly unemployment claims fall to lowest level in 4 years

Perhaps in a thread about prices, but this one is about employment, and to a degree interest rates.

 

Low interest rates do not create buying opportunities. Buying the lowest priced home, even in a very high rate environment, is in the long term the better scenario for buyers to purchase in.

 

Thanks for reading,

John Wheaton NMLS 653018 | Redfin Open Book Recommended Lender
See all my reviews
Silver Contributor
Groundhog
Posts: 536
Registered: ‎12-26-2010
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Re: Weekly unemployment claims fall to lowest level in 4 years

[ Edited ]

BobPhillips-RE wrote:

JW stated:  "A $500,000 priced home with 20% down at an average rate of 3.875% has an "all in" payment of $2,547

 

With a 5% property value decrease ($475,000) and a 1/2 percent increase in rates (4.375%) the payment is $2,530."

 

Care to wager on the chances of a 1/2% increase in rates happening before a further 5% drop in housing prices in Orange County?


Groundhog sez,

 

WHAT A GREAT OFFER, OH BOY!

 

Sadly, I have checked with my friends in professional gambling and been advised to not offer any wager.

 

Apparently it is all about the crows.

 

FYI.........The Gaming Commission has advised that crow is a protected bird species in OC. They have requested me to ask you to please withdraw your kind offer accordingly. 

 

Crows throughout OC are seriously alarmed. I am told they fear having to leave town immediately or risk soon becoming  dinner companions.

 

Groundhog opinion,  :smileywink:

 

OGR