The CEO or Freddie Mac, Ed Haldeman, recently gave a speech to the Detroit Economic Club regarding a number of issues including the state of the current Real Estate market. According to Mr. Haldeman we are in a "transition to a recovery". He went on to state that the two main factors were the stimulus package and the fact that the Fed was keeping interest rates at record lows.
One statement he made during his speech was particularly interesting to me. He said that he expected the 30-year mortgage fixed interest rate to remain between 5% and 6% throughout this year. Even if they did rise to 6%, the interest rate would still be a record low. When I was a mortgage banker/broker prior to going into Real Estate back in the early 90's , 7.5% was a GREAT rate!
However, I was discussing the interest rate issue today with a buyer awaiting an answer on an offer. He clearly stated that if interest rates rise much above 5%, he'd be out of the market for the house he desires.
We may be only 2 months into 2010, but in today's market it may take several months to search, find, make an offer, and open escrow on a buyer's "dream home". If interest rates go up at the end of this year or the beginning of next year, the amount of house a buyer can afford will in turn go down.
NOW is the time to buy!
As we all keep hearing, interest rates are at "historic lows". But pardon me for sounding a bit like a retail shop owner when I say, "these rates won't last forever". We need to get buyers off the fence and into the market before they regret not buying like so many buyers before them.
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By the way, if you or someone you know is at risk of losing a home to foreclosure, please know that there are new options available to avoid this devastating occurrence. And know that there is someone here you can trust to help. As a Certified Pre-Foreclosure Specialist, I understand the ins and outs of Short Sales and Loan Modifications. I am also a Wachovia and World Bank trained Pre-Foreclosure expert and well educated in the Government’s new H.A.F.A. and H.A.M.P. programs for helping homeowners facing foreclosure.
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