Mortgage rates climbed this week after falling for five straight weeks as concerns over cheap money and rising inflation pushed investors to put their money into stocks, Freddie Mac reported today.

The average rates on 30-year fixed mortgages rose 20 basis points in the last week, growing from 5.48 percent to 5.68 percent, and the average 15-year fixed mortgage was up 22 basis points, from 4.95 percent to 5.17 percent.

A year ago, the 30-year fixed averaged 6.34 percent and the 15-year averaged 6.06 percent, Freddie Mac reported.

An index that tracks the risk of mortgage delinquencies based on housing prices, local economic conditions and fraud increased in the first quarter of 2008 by 23 percent from the previous quarter and 9 percent from a year ago, and is expected to continue rising during the next 18 months.

The primary factors in the increase in First American CoreLogic’s Core Mortgage Risk Index was the tendency for delinquent mortgages to end up in foreclosure and for homes to become real-estate-owned properties, along with flat or declining home-price appreciation and slower job growth, the company said.

Some say I am biased becase I live in the area. However, even if I don’t live in the area, I will consider this disparity between highest wage and moderate home price, combined with long term local supply shortage as a strong foundation continued home price appreciation. This new report reinforced such trend.

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Friday, January 18, 2008 - 9:46 AM EST
D.C., Arlington home to highest wages
Washington Business Journal - by Joe Coombs Senior Staff Reporter
The District and Arlington County are neck-in-neck in the latest survey of high-paying jobs among the nation’s largest counties.

The National Association of Realtors today reported that its forward-looking indicator of existing-home sales fell in November, adding that the “exact timing and the strength of a home sales recovery is a bit uncertain.”

NAR’s Pending Home Sales Index, based on sales contracts signed in November, dropped 2.6 percent from October’s level and was down 19.2 percent from a year ago.

What time is the best time to buy a house (if you still have buying power) ?

From studying history, I find that the best time is not pre-recession (Jan 2008). It may not be in the middle of recession, end of 2008 or end of 2009 (we don’t know how long this recession will last). The best time is when recession is passed (at least officially), when unemployment reached its highest level, that would be sometimes in 2010. I know you don’t have such patience to tame you desire for that long, but let’s throw our emotions aside, that’s the best time to pull the ‘buy’ trigger.