Mortgage Rates ↓ Stocks, & Housing

There are two things we tend to buy less of when the price goes down….do you know what?

Most of us like a bargain when we go shopping and feel much better buying things when they are 10%-20% off or “Buy one get one free or at half off.” But, there are two things that always buck this trend of buying when prices go down. What’s even crazier is that, with these two things, people tend to buy more of after their price has goes up rather than down. Do you have a guess on what they are?

How about real estate and stocks?

According to the most recent S&P/Case-Shiller Home Price Index, home prices on average across the U.S. are back to their summer of 2003 levels, meaning, they’re the cheapest they’ve been in about eight years. That said, are we clamoring to buy homes? No. In February, new home sales in the U.S. fell to a record low. Yet, during the boom times when prices were at their highest — people were buying homes like crazy and “flipping” them and we all know how that story ended.

The same is true when it comes to stocks, historically people tend to stay away from stocks when prices are down. For example, how many of us were buying more stocks as the market was declining to its recent low in March 2009? Many feel comfortable buying stocks when their prices were zooming?

These two examples suggest that housing and stocks are two major categories that defy traditional expectations.Buying these may be a smart long-term plan.

Mortgage rates dipped for the second week in row on news of weak global and US Economic news

Loan Program Monthly Pmyt Rate APR Points
Current Conforming RatesPrimary residences only (Pmyts based on a average loan amount of $250,000) for a historical perspective on rates please visit my blog
30YF $1229 4.25% 4.54% 0
20YF $1531 4.125% 4.37% 0
15YF $1802 3.625% 3.92% 0
5/1 ARM $1037 2.875% 3.12% 0
7/1 ARM $1087 3.125% 3.37% 0
FHA-30YF $1229 4.25% 4.37% 0
FHA-15YF $1833 3.875% 3.98% 0
Current High Balance Rates – (Pmyts based on a average loan amount of $550,000)
30YF $2746 4.375% 4.62% 0
15YF $3999 3.75% 3.87% 0
5/1 ARM $2318 2.875% 3.12% 0
7/1 ARM $2431 3.375% 3.62% 0
FHA-30YF $2705 4.25% 4.37% 0

We appreciate the opportunity to work with you on your next refinance or home purchase transaction.  Please pass this along if you think we can help any of your close friends or family.

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