Rates for 30-year home mortgages approached the all-time low of 4.78 percent again last week, falling to 4.83 percent from an average of 4.91 percent a week ago. The 15-year rate did reach a new bottom, dipping from 4.40 percent to 4.32 percent – the lowest level since Freddie Mac began tracking rates in 1991. Wellesley College economist Karl Case says the Federal Reserve’s efforts to purchase mortgage-backed securities from Fannie Mae and Freddie Mac is lowering rates on Nashville home loans.
An obvious tide of home refinance applications came as a result of these lower rates and for the first time in 4 weeks, new home purchase applications increased by more than 5 percent. Nashville mortgage rates appear to have reached an uncommon low point due to the artifical downward pressure resulting from the Fed’s efforts to purchase MBS paper.
If I have said it once, I have said it 100 times, these rates cannot stay at these levels for very much longer. The Fed is doing everything in its power to help stimulate the US housing market, but at some point, we’re going to have to start paying down the national deficit. I am not telling you to go out there and buy a house or condo right this moment, but this is the time to begin a meaningful discussion.
November 23, 2009, 9:07 pm
November 24, 2009, 3:53 pm
Interest rates at historic lows coupled with fat government and developer incentives would ordinarily lead one to conclude happy days are here again, or at least are imminent. Yet, housing that isn't priced correctly for TODAY'S MARKET isn't selling. It seems counterintuitive, but think about it. The underwriting requirements for a mortgage loan are much more stringent now. Why,I hear tell you even have to prove you can pay a loan back to get a loan. Moreover, these bankers now want you to make a down payment instead of walking away with thousands at closing. How can anyone buy a house under those oppressive conditions? Prospective buyers can't sell their homes to buy another because they're underwater (on their loan, that is) and try getting a short sale approved, that is if you can ascertain who the owner of the loan is. In this market, it would be tough to sell an igloo to an Eskimo. Until realtors, sellers, and developers recognize this market's not going to turn around next week, next month, next year, and probably not for 5-10 years, housing will continue to stagnate. People without jobs or who are insecure in their jobs can't, or won't, buy houses or make house payments. The WSJ reports in today's edition that one in four homeowners is underwater, i.e., owes more than their house is worth. For buyers between 2003-2008, I'd bet that number is closer to three out of four, if not higher. If you've got the money or credit to buy a house or condo and need one now, it's a great time to be a buyer, but I expect it will get even better in the months ahead. For what it's worth.
November 24, 2009, 8:47 pm
I agree that the Nashville market still has another year of slowly falling prices, but my point is that you can buy certain properties now that will be well below the eventual price floor of this market. For instance, did you know that the new Pinnacle building could be 100% occupied if they land this last 225,000 square foot tenant? That would boost the condo buying pool quite significantly and make $230/ft at the Terrazzo look like a 2004 price instead of a 2006 price.
November 24, 2009, 9:53 pm
Interest rates at historic lows coupled with fat government and developer incentives would ordinarily lead one to conclude happy days are here again, or at least are imminent. Yet, housing that isn't priced correctly for TODAY'S MARKET isn't selling. It seems counterintuitive, but think about it. The underwriting requirements for a mortgage loan are much more stringent now. Why,I hear tell you even have to prove you can pay a loan back to get a loan. Moreover, these bankers now want you to make a down payment instead of walking away with thousands at closing. How can anyone buy a house under those oppressive conditions? Prospective buyers can't sell their homes to buy another because they're underwater (on their loan, that is) and try getting a short sale approved, that is if you can ascertain who the owner of the loan is. In this market, it would be tough to sell an igloo to an Eskimo. Until realtors, sellers, and developers recognize this market's not going to turn around next week, next month, next year, and probably not for 5-10 years, housing will continue to stagnate. People without jobs or who are insecure in their jobs can't, or won't, buy houses or make house payments. The WSJ reports in today's edition that one in four homeowners is underwater, i.e., owes more than their house is worth. For buyers between 2003-2008, I'd bet that number is closer to three out of four, if not higher. If you've got the money or credit to buy a house or condo and need one now, it's a great time to be a buyer, but I expect it will get even better in the months ahead. For what it's worth.
November 25, 2009, 2:47 am
I agree that the Nashville market still has another year of slowly falling prices, but my point is that you can buy certain properties now that will be well below the eventual price floor of this market. For instance, did you know that the new Pinnacle building could be 100% occupied if they land this last 225,000 square foot tenant? That would boost the condo buying pool quite significantly and make $230/ft at the Terrazzo look like a 2004 price instead of a 2006 price.