Kelly Zito writes in today’s Chronicle about the slowing mortgage refinance market. “The Mortgage Bankers Association’s weekly refinance index, which measures refinancing volume, dropped 17 percent between mid-October and the week ending Nov. 18. In addition, the volume of all mortgage applications — both refinancing and purchases — dipped 3.4 percent compared with the week before, the Washington, D.C., trade group said.”

“Since September, mortgage rates have risen steadily, taking a bite out of buyers’ spending power and making it more costly for owners to tap into their property’s equity. The average rate on the benchmark 30-year fixed-rate mortgage was 6.37 percent last week, up from 5.74 percent a year earlier, according to Freddie Mac.”

I chose to only quote the facts in this article as I don’t agree that asking people in D.C. and New Jersey, or asking nationally-based economists relates to what ultimately happens in San Francisco.

There’s no question that those of us (myself included) with adjustable rate mortgages are seeing our monthly payments change, but that’s part of the homeownership process. If you want a fixed rate, you might want to refinance now. Once we see things level off a bit in the mortgage world, we’ll likely see a stabilzation of rates. This will give folks the opportunity to set their expectations for their monthly payments.

I definitely don’t agree that the market will “all but shut down” with another half-point increase in interest rates. This guy is obviously out of touch with the fact that people still need a place to live. And they’re not building any more land in San Francisco.

This entry was posted on Thursday, November 24th, 2005 at 7:41 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.