Fixed rate mortgages hit new low

According to a recent article by the Associated Press, Fixed-rate mortgage rates fell last week to the lowest levels in 60 years. The average interest rate for a 30 year fixed rate mortgage is now 4.12%, Freddie Mac said last week. It is the lowest rate on record since 1971, and the cheapest rates since 1951.  Furthermore, the average rate for 30-year fixed mortgages was below 5% for all but two weeks over the past five years. Similarily, the average interest rate on a 15 year fixed rate mortgage is 3.33%, also the lowest rate since the record keeping began in 1991.

HOWEVER…..These record low rates have done very little to re-energize the depressed housing market. Sales of new homes are on track to finish the year as the lowest on record in 50 years. The pace of re-sale homes aren’t doing much better – they are the worst in 14 years.

WHY…….Nation wide, an uncertain economy along with high unemployment have discouraged many Americans from taking advantage of these low rates. Additionally, many Americans have seen little wage increases and as a result of the economic climate, many are saddled by large personal debt. None the less, many can’t even qualify for loans at these low rates. Many banks are now insisting on higher credit scores and a 20% down payment for first-time homebuyers. According to a survey by the National Foundation for Credit Counseling,  just 1/2 of Americans say they will ever be able to saive enough money for any type of down payment, let alone a 20% down payment. Further, only 40% of US households have the necessary credit scores above 700 to receive a prime mortgage rate, according to an Associated Press analysis of Fair Isaac Corp. (FICO) data.   Many repeat buyers do not have enough equity built up in their homes to meet loan requirements. Most alarming, accroding to the real estate research firm CoreLogic, about 1/3 of American homeowners have nearly zero equity or are underwater in their mortgage.

Low interest rates usually encourage many to buy real estate, many middle and lower class Americans can’t take advantage of these record low rates. If you are able to qualify for these prime rates, there are many opportunties available. Here in Jackson Hole, there are several opportunities to purchase bank owned homes or lender approved short sale properties.

Contact us, The Gillespie Real Estate Team at Jackson Hole Sotheby’s International Realty  at for a list of bank owned opportunties in Jackson Hole, Wyoming.

Jackson Hole Year End Market Report

A few weeks ago, Andrew Cornish, owner and president of Rocky Mountain Appraisals in Jackson Hole, Wyoming released his Year End Report. The main conclusion: Despite an increased number of real estate sales in 2010, home values in Jackson Hole continued to decline, with entry level homes hit the hardest.

  2008 2009 2010 2009/2008 2010/2009
Total Residential (Single-Family, Condo,Homesite) Transactions 388 224 296 -42.27% 32.14%
Average Price of Transaction $1,606,595 $1,404,296 $1,462,113 -12.59% 4.12%
Total Sales $623,358,973 $314,562,360 $416,702,350 -49.54% 32.47%


Andy Cornish explains that while the number of sales in Teton County, WY was up over 32% from last year,  certain segments of the market are still experiencing value losses up to 30-40% from peak values in 2007 and 2008.  The single family home market saw the average transaction price increase by over 12% in 2010.  However, Mr. Cornish explains, this is due to a prevalence of higher-end transactions, not an increasing value trend.

Available Inventory (homes for sale on the market) has remained relatively constant between 2009 and 2010, however currently inventory levels are double of that in 2007.  The type of inventory is interesting to note as well. According to the Teton County MLS, the least amount of ‘distressed’ properties exist north of town, while the greatest concentration of distressed properties exist in the Town of Jackson and South of Town, where an estimated 12% of homes for sale are described as bank-owned or have short sale potential.

Conclusion – According to Mr. Cornish’s Year End Report, while the real estate market continued to lose value in 2010, an increase in the number of transactions can provide hope that a market stabilization is in sight. For the entire Year End Report, visit Rocky Mountain Appraisals or contact The Gillespie Real Estate Team at 307-739-8078 or by visiting