Low mortgage rates should attract buyers, refinancers
January 23, 2008
Albany - It's a common sight in south Georgia yards - for sale signs. Now, lower mortgage rates may give house hunters a new reason to buy and new hope to an ailing economy.
"The market has been all over the place the past couple of days, but rates are pretty historically low in the 5% range on 30 years mortgages and maybe even in the high 4 percentages on 15-year rates," said Heath Fountain, chief financial officer with Heritage Bank of the South in Albany.
And with those lowered rates, Fountain says now could be a good time for many homeowners to re-finance.
"Just waiting on the fed to move to cut rates again may not necessarily change long term rates. So I would say for a consumer to not wait too long, or wait on the fed to lower rates again. That may not affect mortgages in long term interest rates," he said.
While mortgage rates aren't directly tied to federal interest rates, banks often follow the Federal Reserve. That happened this week. After the fed dropped the prime rate, most 30-year fixed loan rates dropped half a percentage point. Perhaps the best news the housing industry has heard in some time.
"We have more motivated sellers combined with record low interest rates. We've only seen occasions over the past few years where we've seen the rate dip as low as it's been this week," said realtor Debbie Fulford with Walden & Kirkland Realtors.
While Southwest Georgia has not experienced the housing slump as bad as other parts of the country, mortgage rates here are still at near all-time lows. So it's not only a good idea for re-financers to hop on board the wagon, but it's also a good time for people interested in purchasing brand new homes.
"It's an excellent opportunity for anyone interested in buying a new home. I think a lot of people that are paying rent are seeing increases in their rent payment, so it's certainly a time to compare with the low interest rates with what a house payment would be," said Fulford.
Bottom line: if you want to buy or re-finance, now may be the best time to get locked in before a dramatic shift occurs in the marketplace.