BIRMINGHAM, AL (WBRC) - There is good news for Birmingham homeowners looking to move. Area home sales jumped 46% in November when compared to the same month last year.
Thirty-year fixed mortgage rates also hit a 38-year low last week.
Mortgage rates and home sales tend to move in opposite directions. So it should come as no big surprise that record-low interest rates are helping to boost home sales. The question now is will this trend continue?
"I don't wanna predict the bottom is there or we've almost hit it, but I think we've definetely hit an upswing, and that's a positive thing," said realtor John Mejia of Providence Real Estate.
Mejia says the median home price in Birmingham is up about 4% and he says the first-time homeowner tax credit may have more impact than the sub-5% interest rate.
"The homebuyer credit has had a lot of impact, Mejia said. "Buyers are actually getting off the fence and buying right now. We've seen an improvement in November, 46% over last year, which is tremendous."
"That's been a great move for the economy because it's really boosted home sales," said mortgage broker Steve Hines of Aliant Mortgage. "Home sales would be in the tank without that."
Mortgage brokers like Hines say mortgage rates are still a key in keeping his office busy, but with fewer refinancings than before.
"The good news is the mix has moved from almost exclusively refinances, to purchases," Hines said. "Which, refinances are nice, but for the overall economy for builders and suppliers, we like purchases."
But Hines says don't take these rates for granted. Even though they've been historically low for over a year, the growing deficit and new government borrowing could push rates up soon.