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CNN Live At Daybreak

Real Estate Business Looks for Hot Fall

Aired August 17, 2001 - 08:16   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
COLLEEN MCEDWARDS, CNN ANCHOR: Now to the economy a little closer to home. If you want to buy a house, today's mortgage interest rates deserve a look. If you want to sell one, the low rates may increase the number of perspective buyers for you. Plunging rates have realtors and lenders hopping and hoping for a red-hot housing and refinance market this fall.

Lisa Leiter has the story now from Chicago.

(BEGIN VIDEOTAPE)

LISA LEITER, CNN FINANCIAL NEWS CORRESPONDENT (voice-over): Wally Raineri has been sitting on the fence all year waiting for the right time to buy a new home.

WALKIRIS RAINERI, HOMEBUYER: Because the home we wanted to buy was a lot more than what we had right now, the interest rates were really important to us.

LEITER: For Raineri and many others, now is the right time with mortgage rates dropping to their lowest levels of the year. The average 30-year fixed rate loan fell below 7 percent this week for the first time since March to 6.96 percent. Those rates are revving up home sales in August, typically a slow month for real estate.

JOHN VENERIS, OWNER, REALTY EXECUTIVES: We are seeing people coming into the marketplace when normally they would have waited until next spring. And so this is something that we think we're going to have a nice strong fall season.

LEITER: More and more homeowners are responding to the low rates by refinancing. Refinancings have surged fourfold from a year ago at their highest level since 1998.

MARY GLAVIN, PROFESSIONAL MORTGAGE PARTNERS: I've doubled my numbers. Just in the two weeks of production, I've handed in as much business as I did the whole month of July. So it's been phenomenal. It's great.

LEITER: The Mortgage Bankers Association predicts this will be a record year for mortgages with more than $1.5 trillion loaned, much of it for refinancing.

And because of people like Wally Raineri, it is expected to be near a record year for home resale.

DAVID LEREAH, NATIONAL ASSOCIATION OF REALTORS: These historic low mortgage rates are the primary factor for why the housing sector is standing tall while the rest of the economy is slipping towards a recession.

LEITER (on camera): The drop in mortgage rates surprised some analysts convinced the economy would bottom out by now and long-term interest rates would rise. But with weak economic reports still pouring in, mortgage rates may fall even lower.

Lisa Leiter, CNN Financial News, Chicago.

(END VIDEOTAPE)

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