Hello and welcome to this week’s edition of Moorings, where local and national mortgage and real estate news intersect. Certainly the big news this week is the last minute approval of the debt ceiling deal by the United States House of Representatives which will enable country to borrow more money. We are still waiting for the Senate and Presidential approval of the deal, but it is largely expected to pass sometime today (Tuesday) and hopefully the country put this behind and move forward. It’s been one of those situations where the excesses of the past have caught up with us, and there is no way to make anyone happy with any kind of plan. Fiscal responsibility has the inherent responsibility of saying NO, not a popular word to my two and a half year old son, and certainly not a popular word in Washington.
Now on to other news, let’s take a look and see where interest rates are for this week. Considering the last minute debt ceiling deal, it’s rather surprising to me that interest rates have stayed at all time lows. A borrower looking to purchase or refinance a home at a thirty year fixed conventional mortgage can expect an interest rate of 4.625% which remains at near historic levels. Another phenomenal deal is a five year adjustable rate mortgage which can be had for only 3.5%. Think about that for a minute…only 3.5% interest on a mortgage of up to $417,000. Considering the average American only lives in a home for five to seven years, that is really a fantastic deal.
In national real estate news, the National Association of Realtors announced that pending home sales rose in June. Following a wide swing in April and May, activity increased in the West and South, while decreasing in the Midwest and Northeast, but all regions show gains from a year ago. The overall pending home sales index rose 2.4 percent to 90.9 in June, which is actually higher than last year’s index when the last of home buyer tax credit sales had to close by. Keep in mind that not all pending sales end up closing, but it’s still a positive indicator.
Taking a look closer to home, New Hanover County has had 1,531 home sales year-to-date and an average sale price of $252,464. The average number of days on market is 157. In comparison, last year at this same point there had been 1,650 sales with an average sale price of $257,509 and 134 days on market. Considering that last year’s real estate market had a huge boon with the home buyer tax credit, I think the local market is doing fairly well without it. I would think that if you took out the number of first-time buyers purchasing a home last year to get their $8,000 credit, this year would likely have more sales than last. If you have been waiting for an opportunity to buy a Waterfront home on Wrightsville Beach, call your realtor and go shopping, and make an offer! I have seen properties selling for the best prices in recent history. Well that’s it for this week, until next, Be Blessed and Numbers 6:24-26 be on you.