Mortgage Rates Keep Dropping…4.7%?!
By: Amy Bohutinsky, Zillow VP of Communications | December 17, 2008
Our blog post from last evening is already out of date… mortgage rates continue to drop this morning. As of this post at 10:15am PT, the average 30-year fixed rate on Zillow Mortgage Marketplace is 4.7%. Wow.
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- Stumble it!
- Categories: Mortgages, Zillow
Comments
5 Comments so far
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Andrew Olson on December 17, 2008 3:29 pm
Wow, rates are really getting low. Looks like it’s a great time for buyers to start seriously considering this market. With rates going down and prices staying low for the time being, it’s one of the few times where there’s a lack of equilibrium in terms of interest rate/home price.
DallasDirt » Blog Archive » Mortgage Rates At 4.7%??? on December 18, 2008 9:15 am
[...] what Zillow reports, trolling (and rightfully so) for customers. Yo, local mortgage brokers, what are the rates in [...]
DebtFree on December 18, 2008 2:09 pm
Buyers suckered into purchasing a historically overvalued house, with historically low interest rates, are doomed to financial misery.
One can always refinance to a lower interest rate later, but the purchase price is forever.
I’m a cash buyer, and could care less about interest rates. Until prices return to normal, I will not buy anything. Here’s a view of how far “normal” remains from today’s absurd prices:
graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
The “equilibrium” that matters, is incomes vs home prices. Incomes have not doubled and tripled over the last few years as home prices have in many areas.
Home prices today are not “low”. Not at all. And we are nowhere near a bottom. Home prices will decline another 30% or more, and bottom in 2012 or later (see above chart).
In practice, one buying a $500,000 house today, should expect it to lose $150,000 in value in the next 2 years. Not a big deal if staying long term? Only if financing $150,000 isn’t a big deal. (I certainly wouldn’t carry $150,000 on a Visa credit card, even though my interest rate is under 6%.)
No, better to buy when prices are back in line with incomes, rather than be a slave to four walls and a roof.
Virtually all sales I’ve seen in the last 6 months have been at 30% below than the asking price, which illustrates how far away most sellers are in their perception of their home’s value. And there’s another 30% price decline on the way.
HammeredLiterally on December 20, 2008 7:31 am
If you can even find the means to support the walls and the roof. Impossible.
Atlanta Ga Foreclosures on December 22, 2008 11:31 pm
That is great news! Hopefully Paulson will achieve his 4.5 percent goal.