Arizona Real Estate Notebook

30-year fixed-rate mortgage, average in Western U.S. for week ending May 24, 2007. Blue line is Freddie Mac forecast made 5/8/2007.

“Stronger than expected consumer confidence and recent comments from members of the Federal Reserve (Fed) raised some inflation concerns in the market, causing it to lower expectations of a Fed rate cut this year. This helped push mortgage rates higher this week,” said Frank Nothaft, vice president and chief economist of Freddie Mac. “We expect a gradual rise in mortgage rates over the remainder of the year with sales slipping further in the second half of the year. A gradual recovery returns toward the end of 2007 with modest increases in sales and construction during 2008.