Summary Aug-Dec 2006 Good News!!

These are excellent news for people looking to buy and or refinance. Mortgage rates have continued to slowly drift lower and lower BUT how long will this last??!

Here is a summary of how interest rates have showed according to Freddie Mac’s Primary Mortgage Market Survey

30-year fixed-rate mortgage (FRM) as follows:
For the week ending August 31st the rate averaged 6.44%
For the week ending September 28th the rate averaged 6.31%
For the week ending October 26th the rate averaged 6.40%
For the week ending November 9th the rate averaged 6.33%
For the week ending November 22nd the rate averaged 6.18%
For the week ending November 30th the rate averaged 6.14%
For the week ending December 7th the rate averaged 6.11%

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) as follows:
For the week ending August 31st the rate averaged 6.11%
For the week ending September 28th the rate averaged 6.00%
For the week ending October 26th the rate averaged 6.14%
For the week ending November 9th the rate averaged 6.08%
For the week ending November 22nd the rate averaged 5.99%
For the week ending November 30th the rate averaged 5.95%
For the week ending December 7th the rate averaged 5.92%

One-year Treasury-indexed (ARMs) as follows:
For the week ending August 31st the rate averaged 5.59%
For the week ending September 28th the rate averaged 5.47%
For the week ending October 26th the rate averaged 5.60%
For the week ending November 9th the rate averaged 5.55%
For the week ending November 22nd the rate averaged 5.49%
For the week ending November 30th the rate averaged 5.46%
For the week ending December 7th the rate averaged 5.43%

Frank Nothaft, Freddie Mac vice president and chief economist, explained “higher rates have resulted in houses sitting on the market for longer periods of time, changing the real estate sector into more of a buyer’s market from the seller’s market of the last few years. This is a plus, as it allows potential homebuyers more time to look around and decide what they really want and what they can afford” “And with short-term interest rate increases seemingly on hold, for a while at least, interest rates overall should not experience any big shifts in either direction” “A slowing housing market and signs that inflation is leveling off have helped to lower mortgage rates lately and keep them more affordable” “Looking forward in the housing market, we think that housing is about 2/3 of the way through the correction, and should stabilized by mid-year 2007”

My personal input on all this is as I have said it before, if you have a variable loan that will be re-adjusting soon or if you have an interest only loan, I suggest you refinance now and fix that rate for a longer period of time. You don’t want to be stuck if interest rates end up shooting up next year.