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Landa’s Lowdown – Why Aren’t Interest Rates Any Lower?

“Why aren’t the interest rates any lower?!?” The lament heard by loan officers everywhere. Contrary to the popular belief that when the Fed’s cut the Federal Funds rate that mortgage rates follow in lockstep; mortgage rates are actually about the same as they have been for the last three weeks. Which is, on average, 5.75% for the lowest-fee 30-year conforming loan. If you need confirmation; check out www.freddiemac.com. They provide a weekly survey that is minus any sales pitch or media spin.

It’s tough for hard working loan officers to overcome the media hype that accompanies a “dramatic” Fed move in rates. Is a 1.25% cut in 8 days in the Fed Funds rate “dramatic?” Absolutely. Does it mean that conforming loan rates are 1.25% lower than they were last month? Absolutely NOT.

Mortgages are priced off the 10-year Treasury bond – a wholly different instrument than the Fed Funds rate or the Fed discount rate. Currently, the yield on the 10-year note is hovering at around 3.60%. That yield gives us 30-year mortgage rates under 6%, which is much better that seven or eight months ago.

This move by the Fed will certainly help homeowners who are currently in adjustable rate mortgages. It can even be advantageous to recent home buyers who locked their rates in the 6.5% range last summer. Depending on the size of their loan, a refinance may be in order. And, it’s certainly a GREAT situation for home buyers in the market right now – they can buy more house for the same monthly payment they were looking at last year.

The rate cut seems to be having the immediate sought-after effect – a shot in the arm for the ever popular “Spring” housing market. Now is a great time to buy – there is lots of inventory out there to pick from and great financing options.

Written By:
Terri Landa
Mortgage Advisor
Coldwell Banker Home Loans
Office: 847-382-3780
Cell: 847-921-6817
Email: terri.landa@mortgagefamily.com
TerriLanda.ColdwellBankerHomeLoans.com

Tags: 60010, Barrington, Barrington Real Estate, Illinois, Mortgage, Interest Rates, Fed Rate Cut, Home Buyers, Refinance, FreddieMac, Home Financing

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SOLD – Luxury Living in Lisle, IL – 60532

2001 Hitchcock – Lisle, IL – 60532

List Price:  $849,900

Gorgeous, immaculate and like-new home on 2/3 acre across from wooded park & minutes to the train and I88. Volume ceilings, gourmet kitchen with maple cabinets, granite counters & stainless steel appliances. First floor study, beautiful built-ins & detailed moldings. Luxurious master suite & 2nd family room upstairs also functions as large home office.  Beautiful finished lower level with rec room, game room, wet bar, full bath & fifth Bedroom or Exercise Room. VERY VERSITILE! Call Suzanne at 847-922-7773 or Liz at 847-691-3150 for more information or to schedule a private showing. For more photos & virtual tours, please visit TheLubyGroup.com.

Directions: Yackley (between Ogden & Maple) to Hitchcock West

Click Here for the List Price and Property Details

Click Here for Virtual Tours and Additional Photos

Proudly Listed by The Luby Group – Suzanne & Liz Luby
Coldwell Banker Residential Brokerage – Licensed in Illinois
Suzanne’s Cell: 847-922-7773 Liz’s Cell: 847-691-3150

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Shazam’s “State of the Market” Report – November, 2007

Beep……………Beep………………..Beep….Beep……………………………..Beep……………………………Beep…..Beep………….BEEP………….BEEP…BEEP,,,,,,BEEP….BEEP..BEEP..BEEP
Whether we are talking about recovery on Grey’s Anatomy or in the Real Estate Market, the idea is the same. The recovery will likely be subtle, slow, and complicated by occasional setbacks. It is with hesitation that I even mention recent positive progress in our local real estate world for fear of jinxing it, however, it is undeniable that within the last six weeks the flat-line condition has seen some rhythmic improvement.

From late August until November 2007, we have noted an increasing number of home sales, particularly under $700,000. The properties that have been sold by The Luby Group during this period have been in beautiful condition and value-priced. Generally speaking, the buyers who purchased the properties realized that it is a tremendous time to buy a home with the interest rates still at near record lows, a great supply of inventory and motivated sellers. The real estate market appears to be coming out of its coma, but the recovery will undoubtedly be arduous in its efforts to return to complete health.

Economists from the National Association of Realtors are reporting nationally that “2007 will be the fifth best year for housing on record”. They are forecasting that existing-home sales will be about 5.5 million with two-thirds of metro areas showing price gains last quarter. Unfortunately, the real estate boom from 2001 to 2005 led people to believe that housing is a quick high-yield investment. Consequently, the public has had to adjust these unrealistic expectations and remember the fact that real estate continues to simply be what it has always been: a solid long-term investment. “Buying a home is not a quick-in, quick-out investment. Home ownership builds wealth over the long-term.” According to Lawrence Yun, NAR Chief Economist, a vast portion of the nation’s mid section is under priced in relation to income, and prices in some markets could rise notably with good local job gains.

I believe the outlook for real estate sales in the upcoming months is good for a number of reasons. There is obviously a certain pent-up buyer demand from those who chose to forego home purchases in 2007 due to the market being in a period of correction. Additionally, many buyers are regaining confidence that home ownership is a great long-term investment and that the 2007 time of crisis could turn out to be a great time of opportunity. The fact that there is ample housing inventory, job stability and favorable interest rates all bode well for the months to come.

In short, we are optimistic, because we are busy. Our phones are still ringing. Clients are calling. Buyers are still visiting our listings online in large numbers. People are still stopping by our open houses and asking us to email them information about new listings. We are writing offers and closing deals…and it’s NOVEMBER 15TH!  Thanksgiving is just one week from today.  Based on the markets we’ve seen, there’s never been a better time to be a home buyer. And if you’re selling, the buyers out there aren’t behaving as badly as you might think. They’re just taking a closer look and taking longer to digest the recent home sales data before biting the bullet. So please feel free to give us a call…STAT! Our real estate defibrillators are ready to go and we’ve got our fingers on the pulse of some of the best deals and most beautiful properties in town.

Written by Suzanne Luby (a.k.a. “Shazam“)
The Luby Group – Coldwell Banker Residential Brokerage
Barrington, IL 60010
Suzanne’s Cell: 847-922-7773
Suzanne’s Email: Suzanne@TheLubyGroup.com