Interest rates for co-ops, condos at new low in July - Manhattan Mortgage Company report for July 1992

Real Estate Weekly, August 26, 1992

After falling in June, interest rates for New York luxury coops and condominiums plunged to new historic lows in July.

So reports the Manhattan Mortgage Company, a specialist in co-op, condominium and private home residential financing, which surveys and analyzes New York mortgage rates and borrower preferences on a monthly basis.

According to its report, which is based on data from 10 major lending institutions, all serving in New York residential marketplace, rates fell for the three leading fixed-rate mortgages and one of the three most popular adjustable rate mortgages.

In the fixed-rate category, 15-year fixed-rate mortgages fell from 8.25 percent to 8.125 percent, 30-year fixed-rate mortgages dropped from 8.50 percent to 8.375 percent, and seven-year fixed-rate mortgages plummeted from 7,875 percent to 7.625 percent.

In the adjustable mortgage category, one-year adjustables fell from 6.75 percent to 6.375 percent, while three-year adjustables remained at 7.375 percent and five-year adjustables held at 7.50 percent.

According to Ellen Feldschreiber, partner of the Manhattan Mortgage Company, the almost across-the-board declines in July's interest rates can be attributed to the economy's slow recovery, falling bond yields and Federal Reserve rate cuts.

"The Fed continues to cut rates in an effort to stimulate the economy," says Feldschreiber. "We are seeing many new homebuyers and a tremendous amount of refinancing as people clamor to take advantage of historically low rates."

In terms of loan preferences, The Manhattan Mortgage Company survey reported that 33 percent of co-op/condominium borrowers chose 30-year, fixed-rate mortgages in July, while one-year adjustable-rate mortgages accounted for 32 percent of the marketplace.