Tucson AZ Home Loan Info


Low Interest Rates Aren't The Fuel To Drive Real Estate Purchases

The Active Rain Real Estate Network isn't the place for political grandstanding, in my humble opinion.  The fact is that we have to earn our daily bread based on 'What Is,' not 'What I'd Like It To Be.'

That said, it's been awhile since I was able to fill my daily schedule with appointments for individuals or couples who are:

  • excited to get prequalified for the purchase of their new home, or
  • excited because they can take advantage of the super-low interest rates and refinance to get their mortgage paid down more quickly.

Reaction to 'Job Creation' speech

"Stocks Tumble Worldwide After Obama Speech" was the lead headline on Bloomberg at 4:00 a.m.  The fact is that nobody with money to spend on growth stocks (read investors) believes that the President's direction will lead to growth.  The expectation reflected in this morning's opening bell in an hour or so is exactly the opposite.

Federal Reserve "Central Planning"

Pimco's Bill Gross, arguably the yin to Ben Bernanke's yang, went on the record against the Fed (and by extension the financial policies of the current administration) earlier this week in a commentary piece titled 'Helicopter Ben' Risks Destroying Credit Creation.  Click the link for the reasons why.

The fuel that drives success in Real Estate, Construction and Lending is NOT to be found in government management of the economy.  Low interest rates in and of themselves are NOT the fuel that will drive buyers' ability to buy and sell real estate.

The Fuel That Drives Success: Free Market

I was a homebuilder on Long Beach Island, NJ in the 1980s.  I employed as many as 21 FULL TIME UNION CARPENTERS in New Jersey for more than a decade. That's right, UNION Carpenters Local 2118 Lakewood NJInterest rates on home mortgages were 15.825%, my company was working overtime to meet my customers' demand for new homes and remodels of existing homes. 

Neither union contracts nor high interest rates were an impediment to success.  I was free to succeed or fail without government intervention.

If you had told me then that interest rates would drop to their present levels, I wouldn't have believed you.  I was hoping against hope that rates would get back down to the good old days of 12.000%.

So here we are, with an administration that thinks the answer to our economic woes is yet more government debt.  The world doesn't agree.  ...and in my little corner of Arizona, neither do I.

Interest rates don't drive success.  Free market forces that allow risk and failure are the fuel that will turn Real Estate around and let you fill your appointment calendars.


I'm Mike in Tucson, your preferred Tucson Arizona Mortgage Lender

NMLS #223495

SUNSTREET MORTGAGE LLC ~ Correspondent Mortgage Bank
Offices in Mesa, Tucson, Sierra Vista & Nogales

Comment balloon 5 commentsMike Jones • September 09 2011 08:33AM


Mike - I am in full agreement, and living here in a right to work state, with free market tendancies, I can see the effect of what you mean. We have many corporations moving their operations to Nashville to get away from the regulations that make it difficult to do business in some states. I can imagine that a lot of companies are moving to other countries for the same reason. It has to stop.

Posted by Larry Brewer - Benchmark Realty llc (Benchmark Realty LLc) about 9 years ago

Mike, so are so right.

People will succeed on their own without the help of the government....................if it just stops trying to give.

They need to stop and let the people that built the country go back to doing so. It's citizens

Enjoy the day

Posted by Don MacLean, Realtor-Homes for Sale- Easton Mass (New England Real Estate Center Inc.) about 9 years ago


You are right on the money. less government is what we need to grow the economy and to create jobs.

Good luck and success.

Lou Ludwig

Posted by Lou Ludwig, Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC (Ludwig & Associates) about 9 years ago


Thanks for stopping by to comment!


Hear, hear!


Thanks for being the first to comment.  Looks like I have to have photos to get people to engage with me.  :)

Mike in Tucson

Posted by Mike Jones, Mike Jones NMLS 223495 (SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) ) about 9 years ago

Have to disagree with you on this, Mike. The reason stocks tumbled today (in this volatile market we're having, it wasn't so unusual) was that Europe can't get it's act together. Stocks rose yesterday in anticipation of the President's speech. Long-term, we need a plan to reduce debt. That involves paying for the follies of the last decade (wars, Medicare drug benefit without negotiation with drug companies, and tax cuts) with tax increases. Let's bring back Ike's tax rates and infrastructure spending and we'll have a good economy again. The only errors in Obama's plan are too little immediate direct spending and too many tax cuts -- but he's still trying to compromise up front with the Do-Nothings whose only goal is to bring down America.

Posted by Ann Heitland, Retired from Flagstaff Real Estate Sales (Retired from RE/MAX Peak Properties) about 9 years ago

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