Cool, perfect weather, London Bridge Days, Halloween and Fall….October is such a fun month to be in Lake Havasu City, AZ. Whether you are a local or an out of town visitor, just about every weekend offers a fun community event you dont want to miss!
Recently I am sure you all have noticed gas pricing creaping up a bit. In our economy it seems on thing is tied to another, so Lonnie Stevenson a local mortgage expert, can help explain how this may lead to hight interest rates to come late this year.. check it out.
“IT’S A CRUEL, CRUEL SUMMER…LEAVING ME HERE ON MY OWN.” From 80’s band Bananarama And that’s exactly what potential home buyers and refinancers who stay on the sidelines might be singing.
Although home loan rates are very attractive now, the picture could be quite different as some inflationary factors will likely come to light heading into summer. Oil prices may be on the rise as we approach the summer driving season, some of the economic stimulus might begin to take hold, corporate cost-cutting measures could start to bear fruit, and, perhaps most importantly, the Fed will no longer be a buyer of Mortgage Bonds. These are all ingredients in a recipe that could very easily result in significantly higher interest rates this summer…so if you have been thinking about acting on a home loan, do not delay.
But with no hint of inflation in the current market, why would Bond traders be fearful now? Are they listening to strange voices and what did they say? The forward looking markets got an earful from Fed Governor Frederic Mishkin last week…and he’s not the only one. Mishkin said that “inflation could come to the forefront, given all of the government programs”, and “once the economy recovers, liquidity must be taken out of the markets”…meaning the Fed may need to rapidly hike rates down the road, to control the potential of inflation.
In other news, Stocks around the globe faced heavy selling pressure last week on renewed fears of the deepening worldwide economic slump…and this despite better than expected earnings from Google and IBM, as well as GE meeting earnings expectations. Even with the downward pressure on Stocks which can sometimes benefit Bonds, the mention of the “I” word left its mark, with home loan rates ending the week around .25% higher than where they began. ”
Taken from Lonnie Stevenson’s newsletter. Click here to read the full version. If you didnt real the last post, check it out. There really are some fantastic real estate buys in Lake Havasu City. I would seriously consider buying now while interst rates are still at historic lows… so get off the sidelines.
More good news for home buyers in Lake Havasu City and around the country! Mortgage interest rates continued to decline this week to new record lows.
Freddie Mac reported that interest rates for a 30 year fixed mortgage are now below 5% (4.95%) which is down from last weeks 5.1%. These lower rates have caused a surge in home loan applications and refinances. Lately it seems that many of the homes sold in Lake Havasu City have been purchased with cash, but for those cast strapped buyer, these interest rates are generating a lot of home refinances as well as new loan applications.
“The fact that interest rates have dropped to a record low is an important development since more affordable home financing could help bring buyers back to the market and prevent some of these foreclosures,” says Lawrence White, professor of economics at New York University’s Stern School of Business.
Other rates were mixed for the week:
15 year fixed rates: averaged 4.65 percent, up from 4.62 percent.
1-year adjustable rate mortgages: fell slightly averaging 4.89 percent from 4.95 percent last week.
5/1 ARMs: averaged 5.25 percent compared with 5.49 percent last week.
Many experts are predicting interest rates to continue to drop to around 4.5%.
‘Mortgage rates have continued to drop ever since the Federal Reserve announced a plan in December to buy up $500 billion of mortgage securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae—the government-sponsored enterprises.’
Looking to buy a new home? Here is look at how interest rates will affect your mortgage payments.
Average sales prices of a home in Lake Havasu City = $180,000
Downpayment -of 10% = $18,000
Principal = $162,000
5.1% Fixed rate = $879.58 mo. payment
4.95% Fixed rate = $864.71 mo. payment
Savings of $14.87 per mo.
Savings of $178.44 over 1 year.
Savings of $5,353.20 over 30 years.
If you have been waiting for the right time to buy real estate in Lake Havasu City, AZ – NOW is the time! Coldwell Banker is promoting a nationwide 10-day sales event starting Oct. 10th – Oct. 20th.
All participating homes listed by Coldwell Banker will be reduced a minimum of 10% !
As part of this event Havasu Foothills Estates is bringing even more savings on all developer owned home sites. Havasu Foothills Estaes is offering a total of 20% off all developer owned lots for sale and 10% off select homes for sale.
For more info on these great real estate deals in Lake Havasu City, please contact me.
Hurry in – this sales event ends October 20, 2008.