About this time a year ago, I was pointing
out that with Kenai mortgage rates at near historic lows, the opportunities for first time
home ownership had seldom been better. Although, as always, there is a lot more
to a family’s decision than the cash-flow dimension, it’s undeniable that those
who took advantage of low mortgage rates in 1993 could look forward to spending
the next 30 years making the their friends and neighbors feel like they’d
missed the boat. When you are paying 6.8% for your home while your next door neighbor — who bought just one year later — is struggling at
9.2% every month, it’s no wonder your car looks a lot newer. And why you’re
always jetting off to exotic vacations while they check out the latest
That was what was happening a year ago, but
this year is different. I can no longer tell you that mortgage rates are at
near historic lows.
That’s because last week,
mortgage rates hit absolute historic lows!
According to Freddie Mac’s Primary Mortgage Market Survey, 30-year fixed-rate mortgage rates (FRM) averaged 3.62%. There were other
bottom-scraping stats in the same report, including the average of 0.8 point (with an asterisk that points out
that closing costs vary); but the real headline-maker was that further drop in
mortgage rates. Down from 4.6% a year ago. That’s an all-time low in Freddie
Mac records – and they go back to 1971.
“Recent economic data releases of less
consumer spending and a contraction in the manufacturing industry drove long-term
Treasury bond yields lower over the week and allowed fixed mortgage rates to
hit new all-time record lows,” said Freddie Mac’s chief economist, Frank
Nothaft, quoted in the July 5 release.
You can bet that Kenai buyers
and sellers are listening. If previous
talks of a housing recovery haven’t been enough to motivate first-time buyers
or investors to jump into the market, mortgage rates like these often do the
trick. And if you are on the opposite side of the home-selling equation,
weighing the best time to sell your Kenai home, this might be the signal you’ve been
waiting for. Record-breaking low mortgage rates (and corresponding headlines)
can help breathe life back into any market, including Kenai home
sales. Properties that are properly
priced and well-marketed stand the best chance of taking advantage of an
Every market is different, and often varies
from neighborhood to neighborhood. Call me if you want to chat about market updates and how
they might affect your individual outlook.