Lower Mortgage Rates and Higher Growth Good for Northeast Mississippi Housing

By Richard Barrington
Local Lender Columnist
Jun 4, 2008
While it is impossible to pick up a newspaper or watch the evening news without hearing about the housing slump and mortgage crisis, this might be a very good time for home buyers in Northeast Mississippi. A mix of lower interest rates and improving growth prospects should be plus for the area's housing market.

No Boom, No Bust

Certainly, many areas of the country will feel some fallout from the burst of the housing bubble. Tighter mortgage lending standards are already reported to be a drag on demand, and if the national economy slows as a result, this drag will become even greater. Even so, the bursting of that housing bubble most affects the areas where the bubble was most inflated. These would be states like Florida and California, but not Mississippi.

Mississippi never became a hotbed for real estate speculation, so it never saw the run-up in prices some other areas experienced a few years ago. One consolation for not participating in the boom is that there is less exposure to the bust. It also means a more consistent, reasonable market for home buyers.

Growth Prospects for Northeast Mississippi

Of course, reasonable prices are not necessarily a bargain if a region is in decline, but in Northeast Mississippi, reasonable prices are paired with favorable growth levels. This region has exceeded the national average in employment growth and personal income gains, two bedrocks of economic growth.

Further enhancing the growth prospects of Northeast Mississippi are plans to build a $1.3 billion Toyota plant near Blue Springs. This type of project has a positive ripple effect on the surrounding economy -- not only will there be new jobs created by the plant itself, but there will construction jobs as the plant is built, and additional jobs as suppliers and other support industries cluster around the plant.

Mortgage Rates Reach Lower Levels

Further sweetening the outlook for home buyers in Northeast Mississippi is the fact that mortgage rates have dropped sharply. Mortgage rates have fallen by well over a full percentage point in recent months, with thirty-year rates their lowest since the spring of 2004. In fact, current rates are some of the lowest mortgage rates in history.

As if all this wasn't good enough, mortgage rates in the Southeast United States are reported to be a hair lower than the national average. You don't have to be a riverboat gambler to see that these considerations taken together signify a winning streak for Northeast Mississippi.

Sources:

• Northeast Mississippi Daily Journal
• Freddie Mac

About the Author
Richard Barrington is a freelance writer and novelist who previously spent over twenty years as an investment industry executive.