WEB JOURNAL

Mortgage rates are on the rise and are now above 5%.  The jump in Treasure notes which is a benchmark for mortgage rates jumped last week to a six month high of 3.75%.  These increases are disturbing to many because this may stop the housing market recovery.  If buyers are able to borrow less money this will not help the housing recovery because many buyers may decide ot hold off on their purchases.  Mortgage applications fell 35% last week from a week earlier.  This problem with the already higher priced homes not moving due to the high interest rates on jumbo loans will not help the housing market.  Last week NAR 's chief economist spoke and said that the higher priced homes across the country are stagnant due to the higher interest rates that exist above the conventional loan amount of $417,000.  Many buyers trying to purchase at the higher level cannot even get financing if they are trying to buy investment property. Many of the higher priced properties that are selling are being bought for cash.  All of these factors contribute to the fact that the multi-million dollar homes are just sitting on the market and not moving.  In the Tampa Bay area a search of the entire MLS system showed that sales of properties above 3 million dollar going back to September of 2008 totaled only 8.  This search includes 3 counties, Pinellas, Hillsborough and Pasco.  Unless something is done to lower the interest rate for jumbo loans I do not see an improvement in sales for the higher end properties. A further search only shows one property that is a pending sale that is listed above the  $3,000,000.00 price.  Meanwhile on the multiple listings there are 138 properties for sale over $3,000,000.00.