From Bankrate:
Average mortgage rates for single-family homes in the 10 largest metropolitan areas as of June 21, as compiled by bankrate.com. The rates are for 30-year, fixed-rate mortgages for 80 percent of the value of the house. A point is a one-time fee equaling one percent of mortgage.
June 21 Prev. Wk
percent+points
Boston 6.81 + 0.22 6.74 + 0.16
Chicago 6.98 + 0.05 6.87 + 0.06
Dallas 6.84 + 0.48 6.69 + 0.52
Detroit 6.87 + 0.04 6.79 + 0.00
Houston 6.81 + 0.56 6.68 + 0.59
Los Angeles 6.87 + 0.47 6.73 + 0.49
New York 6.80 + 0.23 6.70 + 0.21
Philadelphia 6.70 + 0.40 6.58 + 0.48
San Francisco 6.93 + 0.24 6.77 + 0.27
DC Metro 6.68 + 0.63 6.53 + 0.74
National Avg 6.83 + 0.33 6.71 + 0.35bankrate.com’s national average for a 5-year adjustable mortgage, based on a 30-year loan for 80 percent of the value of a single-family house.
June 21 Prev. Wk
percent+points
Average 6.49 +0.32 6.31 +0.33
now is the time for sellers to make substantial price cuts (10% or more). It is only going to get more difficult to sell as the summer progresses.
I hope they do…I’m looking to buy in NY but sellers are still in denial…I am waiting out the summer. Let’s see what happens.
Oh no. Bankrate just killed the RE market. if they didn’t raise rates, RE wouldn’t have slowed down.
Just kidding.
Most of my “RE always goes up in NYC area” friends are finally acknowledging the RE is slowing down. They blame the rates. It is the rates. It is a bubble.
The difference between 3% introductory funny money 03′ period, and todays rates is 100% + higher property taxes + higher energy costs = look out below…98 prices here we come.
I think we will settle at 2003 price within 3-5 years.
I heard a Robert Reich piece this morning on Marketplace(NPR). He described the fed actions as being too proactive on inflation. Anyway, the interesting part was he was saying deflation was a very big concern. With the fed cutting off the RE party with rate hikes all I could think of was all of these people who bought with the assumption that prices only go up.
Investor David: you are far too optimistic, you are either very young or very naive.
At least 5.75%. Bernanke needs to show testosterone on this thing and this is his test.
PS: Investor David If you really believe that you should be long all the homebuilders and mortgage co’s.
If not, I will from here on call you inventor David.
Inventor of fake forecasts.
I find this site of interest. However it seems many of the posters here seem to take a delight in the slowing market and are actually rooting for a total collapse. Even this post, ‘7% here we come’, is a tempest in a tea cup. Rates are still very low by historical standards. All the most affluent people I know (with wealth other than real estate) are all owners of real estate, what does that tell you? You’re better off owning an asset if you can make your first purchase with at least 20% equity.
ds “All the most affluent people I know (with wealth other than real estate) are all owners of real estate, what does that tell you? You’re better off owning an asset if you can make your first purchase with at least 20% equity.”
Price is the single most relevant factor to consider on any asset purchase…funny myself and all the big guys I know have been dumping RE into this market (we will be back), its the little guy that thinks being a buyer now is a bright idea.
I hate the argument that even at 7% the mortgage rates are at historical lows. How does this argument hold any weight when prices and taxes are at historical highs. Interest rates will rise and fall but you’re stuck with the price of the home for life.
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On the lighter side of NJ housing news:
McGreevey, Partner Set To Close On $1.5M, 8-Bedroom Home in Plainfield
http://tinyurl.com/mjgow
I think this is the house:
MLS# 2265767
Listed: $1.8 Million
Sold: $1.5 million
16% lowball
7% is a comfortable level. That is the rate I had when I bought my place in 2001. Its the ideal rate that allows property prices to reflect the property’s true value and will also force buyers to stay within their means.
Expect home prices to drop 40-50%. Giving us a normal market once again.
I’d love to get solid confirmation on that.
McGreevy is a lowballer? That is most certainly front-page news.
grim
Escape from NJ said “Interest rates will rise and fall but you’re stuck with the price of the home for life.”
So well said, it deserves repeating.
I’m not sure if that is the place, the property size isn’t 1.7 acres.
Otherwise, it’s an incredibly close match.
It was relisted, the original list price of the expired listing is closer to 2 million.
grim
Grim said “McGreevy is a lowballer? That is most certainly front-page news.”
Cmon Grim you know he’s a low baller – high baller any kind a balls he can get!
metro,
Was this the piece you heard on NPR?
Did Greenspan fail us?
STEPHEN BEARD: Alan Greenspan retired earlier this year garlanded with honors and accolades. One economist called him “the greatest central banker who ever lived.” But one London fund manager begs to differ. Tony Dye says Greenspan was a disaster. Dye traces the cause of the current market turmoil back to Greenspan’s watch at the Fed.
TONY DYE: “The reason for it was the mistake about puffing the bubble up and not taking the punchbowl away, because that’s what I think central bankers should be doing, in the mid to late 1990’s.”
Dye argues that Greenspan inflated the stock market bubble of the 1990s by holding interest rates too low. He failed to take the punchbowl away when the party got started. And then when the stock market crashed in 2000 he had to slash rates to rock-bottom levels and keep them there for more than a year.
DYE: Cutting rates to one percent was basically to try and paper over the cracks of all the problems that would have arisen from the stock market bubble bursting. And it’s just created more problems.
“All the most affluent people I know (with wealth other than real estate) are all owners of real estate, what does that tell you?”
That they probably aren’t buying real estate in 2006.
Interest rates will rise and fall but you’re stuck with the price of the home for life.
I listened to NPR today and didn’t hear the Robert Reich on Greenspan..
Did hear a piece on the economy…when will the unfounded talk of stagflation stop? when the Fed stops raising rates.
Good piece on stagflation over at Mish’s blog.
Flationed Out
grim
Well Well I have lost a couple good sales, but Mc greevey oh I am saddened, I have a letter from him promising to call me when he was out of office and looking, although at that time he was thinking of hudson county… Oh well….
KL
Plainfield has some truly majestic and gorgeous houses. Its hard to believe when you look at downtown Plainfield, but the city used to be a gem.
I think we see FF’s at 6.00 before year end, which would make the rate 3 over the the alleged inflation rate of around 3%ish.
InvestorDavid With all due respect 3 to 5 years befor prices get to 03 levels, lets be honest they were getting out of control in 03, and have only gotten worse.
Continued Fed tightening acoupled with the amssive sloe down we are seeing now, I just do not understand your thinking. It seems to be it is perfectly reasonable for prices to rise dramatically in the shortest of time frames, but the opposite cannot happen.
All it takes is one realistic seller, and that becoems your new comp.
‘Int rates rise & fall but you are stuck with price of home for life’ – so what? That is only a problem assuming that you couldn’t afford it to begin with. I will check back to this site in one year and see what all the doomsday prognosticators are saying. I highly doubt that prices in the metro area will collapse – sellers usually don’t have to sell so they won’t be forced into accepting less than market value for their homes. Northern NJ and the Jersey Shore will not stop being within 50 miles of NYC, that alone supports an expensive market. Just because speculative condos are not selling in Jersey City doesn’t mean that property values in RIdgewood are going to drop by 30%…but only time will tell
Anyone remember what interest rate banks were paying under Jimmy Carter in the 1970s? Were people earning double-digit interest on their savings accounts?
unrealtor, no. not double digits.
I had an old passbook then at 8%
anom: I used to try to be reasonable with people like you, but why bother, man I hate ignorance.
Was the shore and NNJ next to NY 5 years ago, of course, can you oh wise one explain to us all what ahppened to justify the 100% or more increase in less then 5 years.
Who cares what the price of the hosue is, boy oh boy, you are truly dumb, I hope you are not in a position of managing other people’s money, scary thought indeed.
The underlying value of the asset is the most important aspect, not the financing mechanism,such an easy concept, obviously you have difficulty understanding that.
And yes in a year or so from now houses in Ridgewood and elsewhere will be down at least 20 to 25$ or more, nothing you can do about that.
Oh and one more thing Einstein your comment people wont sell at less then market price, well guess what, market price is what people are willing to PAY!!!, not what sellers will accept.
Its time for boys and girls like yourself to go home now, its grown up time now.
interest rates are not at historic lows. if you’re 25 and view history as being ‘after you were born’, then you are correct. but rates are actually right in the middle of the average over the past 75 years – that includes the depression as well as early 80s.
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