Is now a good time to buy a home? Mortgage rates don't know what they want to do. The 30 year fixed mortgage rate was at a 4 year low towards the end of January. Then they went up, down and now they are inching up again. Where will they go next week? I think they may be bipolar.
Today's Mortgage Rates
30 year fixed - 6.08%
15 year fixed - 5.55%
5/1 ARM - 5.15%
30 year fixed jumbo - 6.96%
5/1 jumbo ARM - 5.85%
These are national averages.
Here is a chart of 15 and 30 year fixed mortgage rates for the past year.
This chart and rates are courtesy of bankrate
Eventhough mortgage rates in general have been inching up, I think it is a good time to purchase a home. During the 80's and early 90's interest rates were around 10% and higher. In the mid to late 90's interest rates were around 7% to 8%. The only time interest rates were cheaper was during the summer of 2003 when they were in the low 5% range.
In addition to interest rates being reasonable right now, the economic stimulus plan recently approved by Bush Jr. will raise the loan limit for Freddie Mac and Fannie Mae. The current FHA limit here in Cecil County is $292,685. It is estimated by the National Association of Realtors that the new limit for Cecil County, MD will be $385,112 for FHA and $417,000 for GSE. The new loan limits will be published by HUD on March 14th. I will post them here when they do.
It is a buyers market right now. You have a lot of options that did not exist a few years ago when it comes to purchasing a home. There are good houses on the market right now and not enough buyers. You can find that home of your dreams for a good price.
So is now a good time to buy? I say yes! Trying to time the market could be risky. "In general, it is very difficult to time the market," said Raphael Bostic, associate director of the University of Southern California's Lusk Center for Real Estate. "The real problem with that is you don't know when the floor is until after it's passed. If the floor is right now, you missed it."
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