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At the same time, interest rates have been hovering at historically low levels, with the 30-year fixed mortgage rate at around 6.6%, compared with the 7% to 8% range we've generally seen during the past several years. That's made acquiring a mortgage more attractive than at any time in recent memory.
"With rates where they're at, people who may have put off buying property are jumping into the market," says Christopher Avena, operations manager for National Foreclosure Corp., which renovates and then sells foreclosed properties. "As a result, neighborhoods that have good school districts and that are convenient to all kinds of transportation are places you can't even touch." Still, most investment strategists don't think interest rates have room to fall much lower. And if rates start to creep up, potential home buyers will be put off.
Similarly, many real estate industry experts say that since the early 1990s, with the economy booming, New York City housing prices have climbed up around 50%; in some highly desirable neighborhoods ? such as Brooklyn's Park Slope ? prices, in many cases, have doubled. "Eight to 10 months ago, brokers in Park Slope were searching for houses to put on the market because things were selling so fast, and at such high prices," attorney Brown says. But Brown and others assert that the weakening stock market reflects concerns that the U.S. economy is also losing its vigor. If that's the case, demand for property will slow, cooling off prices on apartments and houses.
The bottom line? "By spring, we'll have a much better idea of where the economy is headed," Richard Loessler says. "So if you can wait until then, you'll be well served."
