The jumbo mortgage market has been severely restricted, with soaring interest rates and limited availability, and these
problems are affecting the entire housing market. According to insights from NAR research, sales of homes priced above $750,000 have stalled and inventory has climbed from 18.7 months in 2007 to 41.1 months in 2009.
While mortgage rates on conforming loans up to $417,000 are near 50-year lows, jumbo loans currently carry unusually high interest rates. In many cases, wary lenders with overly stringent credit standards add to the problem by treating jumbo loan applicants with high credit scores and sizeable down payments as higher risks than buyers in the conforming market who have lower credit scores and less money available.
Jumbo Loans for Median Homes
Many people assume jumbo loans are for the wealthy, but in some areas of the country these loans are for median priced homes. As a Realtor®, from my perspective the jumbo loan market has thankfully only affected high end local real estate activity. Therefore the jumbo market has not impacted the general buyer in their home search in our market where the median priced home is $153,000.
Sales are down in terms of shear numbers, to be sure, but where our overall market is off year to date roughly 42 percent compared to this same time frame a year ago, sales of jumbo homes have decreased from 59 sales last year to 25 thus far in 2009 for a 58 percent decrease.
When will the turn around come for the jumbo home sales? When jumbo mortgage products are not priced out of the market.
If you are a buyer in our market, these are probably the best buying conditions in 30 years! If you would like to search the Athens MLS with MapTracks please take a look at listings in our “Classic City” today! On this web MLS search solution you can search every listing on the Georgia MLS for the Greater Athens area or in your Georgia town!