To All My Readers: Interest rates continue to be at an all time low due to our sluggish economy and feds reluctance to in any way put in danger the recovering housing market. While interest rates have ticked up a bit from last year, they are still at historically low levels. Just to give younger readers some perspective, when I graduated from college in the 1980’s the interest rate on a 30 year fixed mortgage was over 9%. Needless to say i had to buy a smaller house than I wanted to because of what the interest rate did to my monthly mortgage payment. If you are a young person my advice is to buy now before the rates tick up again, and buy bigger than what you think you need for additional room as your family grows. I had no one to advise me, and after I bought my first home my wife became pregnant and the house I just bought was already to small. Thus we had to go through the process all again, this time finding a bigger home until number 4 came along and then that home was too small as well! Set your sights on a 4 bedroom, 2 or 3 bath home and you should be okay. As always, feel free to call me Richard Kemper at 813-777-5332 with any of your real estate questions.        

Average rate on 30-year mortgage at 4.22%


Mortgage Rate Trend Index

Half the experts (50%) polled this week by expect little rate change over the short term. However, only 8% foresee an increase; the remaining 42% predict additional decreases.

WASHINGTON (AP) – Nov. 22, 2013 – Average U.S. rates on fixed mortgages declined this week after two weeks of increases, keeping home buying affordable.

Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan fell to 4.22 percent from to 4.35 percent last week. The average on the 15-year fixed mortgage dipped to 3.27 percent from 3.35 percent.

Rates had spiked over the summer and reached a two-year high in July on speculation that the Federal Reserve would slow its bond purchases later this year. But the Fed held off in September and now appears poised to wait at least a few more months to see how the economy performs. The bond purchases are intended to keep long-term interest rates low.

Mortgage rates tend to follow the yield on the 10-year Treasury note. They have stabilized since September and remain low by historical standards.

Still, mortgage rates are nearly a full percentage point higher than in the spring. The uptick has contributed to a slowdown in home sales. The National Association of Realtors said sales of existing homes fell 3.2 percent in October, the second straight monthly decline.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged at 0.7 point. The fee for a 15-year loan also was steady at 0.7 point.

The average rate on a one-year adjustable-rate mortgage held at 2.61 percent. The fee was unchanged at 0.4 point.

The average rate on a five-year adjustable mortgage fell to 2.95 percent from 3.01 percent. The fee rose to 0.5 point from 0.4 point.

Copyright © 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Here is what Florida Realtor news just reported…

July pending home sales slip a bit

 WASHINGTON – Aug. 28, 2013 – Pending home sales were down in July with higher mortgage interest rates slowing the market, according to the National Association of Realtors® (NAR) monthly Pending Home Sales Index (PHSI).

The PHSI, a forward-looking indicator based on contract signings, declined 1.3 percent to 109.5 in July from 110.9 in June, but it’s 6.7 percent above July 2012 when it was 102.6. Pending sales numbers have risen in year-to-year comparisons for the past 27 months.

I was actually concerned about this several months ago when all the area builders took 3 price increases in a matter of a few months. I had a conversation with a builder rep where I told him I didn’t think the market could sustain what amounts to a 26k price increase. Then interest rates started to rise. Rising prices and interest rates causes several issues for home sales. First is some of the first time home buyers find themselves priced out of the market because there is now very little available in there price range coupled with what they can afford to purchase is now a smaller number because of higher interest rates. The other issue is consumer confidence. People feel uncomfortable with prices and interest rates rising so quickly here in the Tampa market and may sit back from purchasing a home as the last thing people want is a repeat of the past with people upside down a few years from now.

Well, none of us has a crystal ball, but the home sale stats don’t lie and that is to say homes sales dropped in July. As a Realtor, I would still encourage buyers not to be hesitant to purchase a home here in the Tampa area. While on the rise, interest rates are still at an all time low for my life time!

As always, I welcome your comments. If you know of anyone in the Tampa area that is thinking of purchasing a home, please have them contact me, Richard Kemper at 813-777-5332.

Make it a great day!