The Fed Has Lowered House Prices By Over $20,000

I have said for 11 years that the interest rate on a mortgage is more important than the price of a home when it comes to calculating the monthly payment of a home. Let me prove it to you—

On November 24th when this HUGE mortgage bond rally started, FHA mortgage rates were at 6%. Today, they are at 5%, a decrease of 1%. Thus, on a $200k loan a buyer’s monthly payment just dropped $127!

This is equal to a price drop of $21,182 in the last 22 days! This is GREAT news!!!

More Good News for Colorado Housing

It was reported this week that there 14% fewer foreclosures completed in our great state in the first 9 months of the year compared to the first 9 months of 2007. This is the first time we have seen a year over year decline since 2003!

Kathi Williams, Director of the Colorado Division of Housing, said she is “cautiously optimistic about the future.”

A second report revealed that Colorado’s delinquency rate is below average. This week TransUnion reported the delinquency rate on mortgages throughout the country as of September 30th. They define their delinquency rate as at least 2 months behind on their mortgage payments.

In Colorado our delinquency rate is 3.38% which is 15% below the national average of 3.96%. On average the national delinquency rate is normally around 2%; but has risen considerably in the last 18 months.

What does this mean for first time home buyers? The end of Denver homes being on "sale" is nearly over and will probably end in 2009. Don't miss out on this once in a generation sale.