Are Homes Costing More?

We are beginning to see more activity and buyers seem to be recognizing good deals and
well priced properties. There is more of a sense of urgency as we hear rummors about
Freddie Mac and Fannie Mae being terminated and lenders being put on salaries instead of commissions.
Everyone is wondering what affect it will have on buyers getting mortgages in the future

As I mentioned in my last Blog I hope buyers are paying attention to the interest rates not home prices.

The Primary Mortgage Market Survey released by Freddie Mac showed that the 30 year fixed rate mortgage was at 5.05%. Long term bond yields jumped which caused interest rates on a 30 year
fixed rate mortgage to rise to the highest level since the last week in April of 2010. So prices
have remained stable but interest rates have risen dramatically in the last 90 days.
National median prices have gone from $170,300 in the 4th quarter of 2009 to $170,600
in the 4th quarter of 2010 which is only a o.2 percent change. Even if prices fall another 10% this year the cost of a home
will increase if interst rates go up more than 1%. So, I hope buyers are worrying about where their
costs will go later in the year not prices.