They just keep dropping...

In case you have not heard Freddie Mac reports that long-term mortgage rates have moved down again.


This week interest on 30-year fixed loans hit a new low of 4.49 percent, compared to 4.54 percent last week and 5.22 percent a year ago. For those of you in position to take out a 15-year mortgage, they have hit a huge low dropping to 3.95 percent, down from 4 percent last week and 4.63 percent a year ago. Five-year adjustable-rate mortgages also reached a historic new low of 3.63 percent, down from 3.76 percent last week and 4.73 percent a year ago.

For those who have been on the fence about purchasing a home or refinancing these rates should prove enticing. It is unlikely that interest rates will soar anytime soon but why take chances. You would hate to be the one who says man I should have moved quicker on those rates.

These historic rates and the dramatic home bargains available allows one to buy much more home for the dollar than any time in the last ten years.

Interest rates and opportunity...

If you were in Bend the last time we saw the housing market take a tumble, you would have witnessed scene reminiscent of today’s struggles. Many watched as the homes they purchased in the late 1970’s and early 80’s fall in value by as much as 40%. Such a dramatic drop in values presented those with the means the opportunity for some incredible bargains, which they turned into huge profits in later years. Most folks who wanted to purchase these bargains found them unobtainable as interest rates soared into double digits preventing most from taking advantage of what was at that time the “opportunity of a lifetime”.


As history has repeated itself and “opportunities of a lifetime” are once again plentiful. Your advantage in this go around, interest rates! What once crippled the housing industry has swung the other direction to a point so low one would not have imagined it possible just a few short years ago. Since late April interest rates are at historic lows and hover below 5%. As this week comes to a close rates have remained steady with a thirty year fix rate loan coming in at 4.72%. While under writing standards are as tough as they have ever been, we are seeing folks take advantage of today’s market to seize what will be tomorrows “I wish I would have bought that…” moment.

Many industry experts had anticipated a rise in rates this past spring, yet with the stumbling of the European financial markets our bond markets have remained a strong value for investors to invest their money. Common sense would say that as the markets stabilize interest will slowly begin to climb. As the rates climb the window of affordability for buying will shrink, the ability to snap up properties at a great value may slip away.

Will you be one of those that follow past cries saying “I could have bought that property five years ago for…”? While our market will not see rapid appreciation any time soon, now is the time to buy low so in five years you will be the one selling high.

Time to get off the Fence, Sunset is coming….

The April 30 deadline for selecting a home and having it under contract is just weeks away. The National Association of Realtors has been in extensive discussions with Congress to gain an additional extension of the tax credit. Today the association announced that it is not likely to occur. The tax credit deadline combined with this week’s news that funding for the USDA Rural Housing Programs will run dry at about the same time and the Federal Reserve will no longer buy Fannie Mae and Freddie Mac mortgage backed securities signal it’s time to get off the fence and buy one of today’s bargains.


For many the tax credit program when combined with the USDA program can make all the difference in the world. Waiting for the perfect property or for the bottom of the market might prevent many from realizing their homeownership dream. For the rest of us fence sitting can prove equally damaging. Waiting, waiting, waiting, and then bam next thing you know it interest rates have risen and you can afford less house than before. By waiting you may have a slightly better price on the house but that added interest has moved you just out of the range of affordability.

If you are waiting on the fence do not fall prey, programs will be ending and interest rates will be rising. The programs have been fantastic, prices and interest rates are at historic lows, do not miss out the party is about to end.

Up Coming Dates to Consider

Larry Wallace over at True North Mortgage sent out an email this morning highlighting some important dates some important dates for homebuyers.

March 31st: The Fed is scheduled to stop subsidizing home loan interest rates.
It is entirely possible that they will extend the subsidy, should they choose not to extend look for higher interest rates and higher monthly payments.

April 30th: Tax credit for purchasing a home. The home has to be “in contract”, (i.e. accept offer to purchase) or lose the credit.

June 31st: Tax credit for home purchase must close escrow or lose the credit.

Spring/Summer: FHA mortgage insurance will become more expensive. The effective date is still pending.

Spring/Summer: FHA to reduce allowed seller paid closing costs from 6% to 3%. This will mean the buyer needs to provide more cash at closing. The effective date is still pending.

Missing these dates will make a home purchase much more expensive, it could even leave priced out of buying a home!!

You can contact Larry at larryw@bendbroadband.com or at his office 541-323-8783

Weathers Changing and so is the Market!!

Fall has quickly come upon us this week in Bend with dramatically cooler weather and trees that are beginning to change their colors. Just two days ago we were water skiing at Crescent Lake in swim shorts and ski vests. Today it's mountain biking with fleece tops and leggings. Yesterday brought some of the first snows of the season to the higher elevations surrounding Bend tantalizing all those who pray to the snow Gods for an early ski season.

As fall is changing our recreational opportunities the housing market is also changing. Last month our office posted the busiest month since 2007. At the heart of the activity is the influx of first time home buyers and investors swooping up some exceptional values in today's market. Many of the better priced properties are receiving multiple offers within days of being listed on the MLS.

With the first time home buyers rebate slated to expire on November 30th there is a rush to find the perfect property for those clients. It will be a tight fit for them to be guided through the process of finding the home they desire, obtaining financing, home inspections, appraisals and closing on the property before the deadline. Those who select the wrong property, wait to long or think that the rebate program will be extended most likely will find themselves left out of the party.

For investors it's finding affordable properties that will bring a good return over the years. The current market has some exceptional properties at prices that pencil out to provide great rental income. Currently bank owned properties offer some of the best values with excellent closing times. Properties in a short sale situation often appear to be great values but often come with lots of frustration in long lead times and poor communication from the third party lenders.

Adding to the mix are the return of normal home sellers who desire to sell their home with out all the drama of the distressed property sale. Many believing that we are near or at the bottom of the real estate markets free fall. While most do not see their home value returning to the illusionary numbers of 2005/06, they feel now is as good a time as any coming up in the near future to sell their home. Upon selling many are taking advantage to buy up taking advantage of the markets tumble.

If you are on the fence about getting into today's market keep in mind that the interest rates of today will not last much longer. Most all of the mortgage professionals that we work with are telling us that by the end of October we will see interest rates begin to rise and will continue to do so well into the new year if not longer.

Fall has so many great opportunities, get out there enjoy all that you can.


Bill Panton
Broker, Duke Warner Realty
1033 NW Newport Ave.
Bend, Oregon 97701
bpanton@dukewarner.com
cell 541-420-6545
office 541-382-8262
fax 541-385-3272