Freddie Mac: Interest Rates Drop Some, But Overall Economy Does Not Look So Hot!

Finally, after several weeks of seeing the average interest rates climb higher and higher, today 3/6/08,  Freddie Mac reported that the average mortgage interest rates for 30 year and 15 year fixed-rate interest rates have dropped a bit! Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.03% (6.03% in the southeast), down from 6.24% a week ago. The average interest rate for 15 year fixed-rate mortgages was 5.47%. down from 5.72% last week.

Mortgage interest rates played "follow the leader" as weak economic indicators, including lower consumer confidence, slowing in the manufacturing sector, and job market declines, pulled the total economic picture to a lower level.

The median prices of new homes fell 15.1% in January and that was the biggest drop on record. As you have heard me say in the recent past, they cannot go much lower. It will be impossible to for them to build homes that they have to sell for less than it cost them to construct. Residential construction fell 19.7% over the past 12 months.

Now, if that is not enough sour news, tonight all of the news stations are trumpeting the fact that for the first time in ages, homeowners on average owe more on their homes than they have equity in them. Since for many Americans their homes are their biggest investments, this is not good news.

Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.

If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com  and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.

If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be, should you decide to finance a home purchase.