14 May 2009

MORTGAGE RATES MAKE UTAH HOMES AFFORDABLE !

Utah Retail Sales, ex-auto. April 2009Home affordability improved again Wednesday after the government reported worse-than-expected results for April's Retail Sales.

In Utah, Mortgage rates edged lower for the third consecutive day.

The impetus for the rate rally this week may be a long-awaited stock market correction.  After touching multi-year lows in mid-March, the Dow Jones added 30 percent going into last Friday. 

It has since lost close to 300 points and as those dollars leave the stock market, they're finding their way toward bonds. 

The demand is pushing bond prices up which, in turn, causes rates to fall.

Yesterday morning, the Utah rally in rates picked up steam on the heels of April's Retail Sales report.  With figures off a half-percent from March and roughly 7 percent from 2008, investors are concerned that consumer spending may not be as strong into the summer months as previously expected.

Consumer spending is important because it comprises two-thirds of the economy and is believed to be the way out of the current recession. Spending in Utah, particularly in the major population areas like Salt Lake, Utah, and Davis counties remains fairly constant and indicate the strength of the Utah Market. 

If expectations of a recovery caused mortgage rates to rise recently, it makes sense that a revision of those expectations would cause rates to fall.

So you had better be prepared to make your move if you are looking to buy a new home in Utah, and want to take advantage of all of the incentives available.

Markets are fickle, however, and the slightest bit of "good news" could pump cash back into stocks at the expense of bonds.  Until then, however, enjoy the low rates -- they may not last long.

In the meantime, if you are preparing to search for a Utah home, check out our home search page on our web site. You will have access to almost all of the MLS listings in the State of Utah.

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