In the general sea of financial bad news we’ve been swimming in lately, despite massive government intervention in the financial sector, real estate has been swirling around, adrift. Finally, though, somebody in Washington threw us a lifeline!
This past week the Fed and the Treasury announced a new program to purchase up to $500 billion in mortgage-backed securities (MBS). Immediately, mortgage rates dropped sharply at the news. The MBS purchases are expected to take place over the next few months. The goal of the new program is to lower mortgage rates, and the immediate reaction certainly was a big step in the right direction, as mortgage rates moved significantly lower during the week.
In fact, 30-year rates are now below 6%. Imagine. It’s a chance to redo 2003 when mortgage rates were their lowest in 30 years. And, 15-year rates are about 5.5%. This really does represent opportunity for the home buyer or for those who want to refinance.
What great news! Homeowners are now rushing to refinance unmanageable loans. And, combined with the sharp drop in real estate prices all over the country and in particular the Southland, homes are now more affordable than they have been in years. As the news trickles out, bargain homes are getting snapped up as buyers flood back into the market…
At this point, not only homes and condos are affordable, but, increasingly multi-family income property, too. The mortgage crisis has hit investment properties and buyers are getting amazing deals...
Diane's Blog 