Interest Rates Drop Slightly
Wow what a little havoc a well planned holiday can play. Working like crazy to ensure I took care of my clients before leaving the country on a little vacation then coming back to a real estate market that is on fire has put me behind on my blogs; way behind. With the Thanksgiving weekend upon us I knew the annual slowdown we experience this weekend would allow me to catch up and for that I am thankful!
Interest rates decreased last week for the third time in four weeks but it was hardly a move at all. Rates still remain near the all time historical lows as the FED continues to do everything in their power to keep them at these levels as we continue to work towards getting the overall economy moving in a positive direction.
As of this morning, the average overnight rate for a fixed 30 year mortgage as reported by Bankrate.com was at 4.02% down 1 basis point from where we stood one week ago. The benchmark 15 year fixed rate standard was at 3.37% also down 1 basis point from last weeks level while the benchmark 5/1 adjustable rate mortgage bucked the trend and rose by 1 basis point to 2.97% from 2.96%. While nobody can say for sure that the lowest rates are behind us they did seem to bounce off the 4.0% support level so we will have to see what the future brings.
Many of my mortgage professionals have reported that refinancing activity has been very strong but calls for new loans have not been what anyone describes as robust. We still have every limited inventory in many housing categories in Palm Beach County which also is having a negative impact on sales. If the Feds’s interest in keeping rates low until more of the shadow inventory can be purchased by end users they might nudge the banks into releasing these properties a bit quicker as we need them to satisfy demand; especially homes in the $250,000 to $400,000 range.
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