September 15, 2010
With all the tough gloom and doom talk out there, it might be hard to believe this, but now has never been a better time to buy a home. True, the economy is in recession, but a quick look at the Spokane real estate market (and especially a look at home financing history) clearly demonstrate that if you are looking to buy a home or refinance your existing loan, now is the time to make your move.
For starters, new Spokane home prices are down. The Census Bureau, which has tracked new home prices since 1963, shows that the average home price for a new home is on a five-month low, with June's median price currently at $242,00, down from February's $284,100 (not to mention the heady days of March 2007, when the average hit $329,400). New home prices haven't been this low since October 2003.
And while the average sale price for existing homes recently ticked up between April and June, with June at $230,900, they were previously on a downward trend that continued from 2009 into March of this year. Comparatively, the overall average existing home price for 2007 was $266,000 and 2008 was $242,700. It should also be noted that the slight upward trend experienced from April to June could have to do with the homebuyer tax incentive, which came to a close in June, so July's and August's statistics could show a move to even more inviting home prices.
Attractive home prices aside, the resoundingly inspiring news lies in current home financing rates. The Federal Home Loan Mortgage Corporation (Freddie Mac) recently reported that mortgage rates were at their lowest level so far this year, and that rates for conventional 30-year, fixed-rate loans were heading to an all-time low. The latest reports from Freddie Mac put 30-year mortgages at 4.72 percent. That is the lowest rate since the week ending Dec. 3, 2009, when it hit a record low of 4.71 percent.
Let's put this in a historical context. The average interest rate for a 30-year loan was 5 percent over the last 12 months. The average over the last 10 years was 6.13 percent. The highest rate since January 1964 was 18.45 percent in October 1981. The lowest rate since January 1964 was 4.71 last December.
That is some history lesson. No matter how you slice it, today's home prices and mortgage rates represent an historic opportunity that cannot be ignored. Whether you are seeking to purchase a home or refinance, now is your chance. Let me tell you more about how you can leverage this bright point in the economic gloom.
Rates and home pricing statistics were accurate as of the writing of this article.