Interest Rates – Freddie Mac® reports that the average interest rate for loans created in the past week was down to 5.85%, for conforming 30 year fixed rate loans. This follows last week’s average at 5.87%. The lowest weekly average so far this year was 5.67% reported 2/07 and the highest so far in 2008 was 6.24% reported 2/28. You can view the history of mortgage interest rates from 1971 through present at
Bullhead City / Ft. Mohave Real Estate Market Stats – This past week 16 residential property sales closed escrow, while an additional 20 went into escrow. The average days on market for the completed sales was 154 days and for the newly pending was only 80 days. As normal this time of year is a good time for property sales in this area and we hope the up-tick in activity is a sign of better times to come.
Don’t forget – if you or anyone you know needs real estate services to buy or sell, here in Bullhead City or anywhere else, contact me and I’ll get to work for you !!
It would be interesting to see a chart of interest rates and average home prices for the last year. Wonder whether interset rates or prices will rise
first. I suspect interest rates will have a larger effect than prices on afforabilty of housing in the near future.
In response to Jim’s comments :
My gut is that interest rates will be the first to rise.
You can see a chart of Mortgage Interest rates from 1971 through 2007 on my web site at http://www.jrhastings.com/time_to_buy1.html, near the bottom of the page.
Also there is a chart of prices in this area over the past few years on my web site at http://www.jrhastings.com/stats1.html
Also in response to Jim’s comments:
Folks may notice also on my web site another chart showing the impact of interest rates on affordability. General rule of thumb is that an increase of 1% in mortgage rates reduces the buyers purchasing power by 10%. In other words a buyer who can afford a $200,000 home at 6.0% will need to settle for a $180,000 home if rates are 7% or a $162,000 home if rates rise to 8%.
Do the near record low interest rates make buying an investment property such as a twin-home/duplex more attractive to investors?
Mark –
Excellent thought. Absolutely true. Generally investors have no emotional attachments to properties. Once they determine if the property is in good physical shape the only factor of interest to them is the bottom line. Unless an investor is speculating that prices will rise sharply and therefore a negative cash flow in the meanwhile is “OK” the decision to buy is based on positve cash flow. The rent value of the property needs to be enough to cover basic monthly expenses, taxes, maintenance and debt service. The lower the mortgage interest rate the lower the debt service and the more attractive the property is.