Lower Rates, Mortgage Applications Increase, Sales Prices Rise

Since the government take over of Freddie Mac and Fannie Mae, the real estate industry overall has seen a rather positive reaction. Mortgage rates have decreased by four tenths of a percent, loan applications have increased by about 10%, with a staggering 14% for loans funded by the two giants. Home sales prices were actually up significantly in several “hard-hit” areas, like California, Florida and the Washington, DC suburbs, and there has been a recent reappearance of multiple bids, which can only suggest that the market has almost corrected itself, and we should begin to see a steady and slow recovery in the months ahead.

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Kenneth R. Harney writes an award-winning, nationally-syndicated column on housing and real estate from Washington, D.C. He is also managing director of the National Real Estate Development Center, a professional education company. He is a past member of the Federal Reserve Board’s Consumer Advisory Council, a committee that by federal statute reviews all Fed actions on home mortgage, consmer credit and banking industry regulation. He served as a member of the U.S. Department of Housing and Urban Development’s Working Group on Computerized Loan Origination (CLO) systems, and is a member of the Editorial Board of the Fannie Mae Foundation’s journal, Housing Policy Debate. He is the author of two books on mortgage finance and real estate.