Good News/Bad News: What Mortgage Shoppers Should Make of Recent Trends

By Richard Barrington
Local Lender Columnist
Nov 9, 2007
Like beauty, the condition of the real estate market is in the eye of the beholder. Some would look at all the headlines about rising mortgage foreclosure rates and the bursting of the price bubble and say the market is a disaster. Others would say that lower prices create a golden opportunity to get into the market.

The truth is, real estate is too area-specific to be summed up in generalizations like that. Even with in a single state such as North Carolina, the beauty of the real estate market can vary from town-to-town, if not property-by-property.

Bargains Are Where You Find Them

For example, single-family home prices in North Carolina rose at a rate of 7.10% for the year ending June 30th, 2007. That's a pretty strong rate of increase--good enough to rank 8th among the 50 states.

Look more closely, though, and you'll see some differences from region to region. For example, prices in Winston-Salem managed to increase at only a 1.24% rate over the same period. In fact, single-family home prices in Winston-Salem actually decreased in the second quarter of 2007.

The point is, if you can't paint North Carolina's real estate market all with the same brush, you certainly cannot do that with the national market. Hot areas still exist, but so do bargains in some other areas.

Good News Wherever You Look: Mortgage Rates Point Lower

If price conditions vary from place-to-place, there is one universal piece of good news, and that's lower mortgage rates. Mortgage rates are down overall since mid-July, meaning cheaper borrowing costs. In other words, amid the swirl of good and bad news around the housing market, mortgage rates are a decent bargain wherever you are shopping.

Sources
Winston-Salem 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.