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Mortgage rates fell to almost record lows this week and mortgage lenders on the Grand Strand said it has led to a little more interest in refinancing and home loans.

The average rate on a 30-year fixed rate mortgage dropped to 4.78 percent this week, just above the record low of 4.71 percent in December, according to the mortgage company Freddie Mac. Low interest rates, even a half point difference, can translate to tens of thousands of dollars in savings over the course of the loan.

In the past two weeks there has been a dramatic increase from the previous month. The refinancing and new mortgage loan applications have more than doubled.

While the interest in refinancing has increased, not everyone is eligible to refinance, especially borrowers whose property values have dropped considerably. Those borrowers could have to put a lot of money into getting a new loan.

The lower mortgage rates do help more home buyers qualify for a loan, but if the credit score and down payment requirements remain high, it won't make much of a difference.

The qualifications for a loan have become tougher during the past year, but that is a result of what's happening on the secondary market. BB&T sells most of its loans on the secondary market, mainly to the mortgage companies Fannie Mae and Freddie Mac.

It seems that Fannie Mae and Freddie Mac are in a competition to see who can have the tightest regulations.

The low rates can't hurt, and may help buyers who were on the fence make the decision.

For the average consumer though, lower mortgage rates are unlikely to have much of an impact.

There was a small increase in business at Crescent Bank as a result of the lower rates, but the change isn't likely to spur someone to buy who wasn't already considering the purchase.

The rates are tied to the bond market and in the past 10 days the bond market has done well as investors have looked for a safe place for their money.

*Courtesy of The Sun News*

 

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Grand Strand real estate eked out a small increase in sales in 2009 thanks to a burst at the end of the year, including a 24 percent jump in single-family homes and a 57 percent jump in condominium sales in December compared with the same period in 2008, according to statistics compiled Tuesday from the Multiple Listing Service.

December marked the fourth month in a row with increased sales in the Grand Strand real estate market. Area Realtors say they're encouraged, but say it may take many months before there is complete recovery for the area.

The sales weren't quite as dramatic as the year-over-year difference in November, when single-family home sales were up 65 percent and condominium sales up 69 percent, but a real estate analyst for the Coastal Carolinas Association of Realtors said that wasn't surprising.

The median price for condominium sales was $120,000, down 20 percent in December from the previous year, while the median price for residential homes was $177,670, according to the data, ecause the median household income in the Myrtle Beach area will qualify a family of four to purchase a $150,000 home.

The success is due to low interest rates, low prices and the first-time home buyer tax credit, which was originally set to expire at the end of November, but was extended through April 30 and expanded to add a $6,500 credit for most people who buy a new primary residence. People who have owned a home for at least five consecutive years in the past eight years are eligible for the $6,500 credit, and people who have not owned a home in the past three years are considered first-time buyers.

Courtesy of The Sun News, Myrtle Beach, SC.