Declining interest rates and end-of-the-year pressure on sellers may be combining to produce one of those rare and fleeting events for home buyers and small-scale investors: a genuinely advantageous point in the market cycle to negotiate for a new or resale home.
Interviews last week with top mortgage-market and Wall Street economists produced unanimity on four observations:
* Long- and short-term capital rates have nearly hit their cyclical low for the coming 12 months. Rates on 30-year mortgages may drop another 0.25 to 0.50 percent in the coming six weeks. But then they'll plateau and begin to edge up for most of 1985.
* Competition for mortgage borrowers' business is exceptionally strong in many markets across the country. Lenders are offering 15- and 30-year loans at cut rates, and are discounting their adjustables in an effort to stoke up consumer demand during the traditional seasonal slowdown.
* Realtors' and home builders' stocks of leftover 1984 "product" -- their inventories of unsold homes -- are heavy in many markets. With the traditional end-of-the-year slowdown and vacations of sales personnel, many firms are open to extra-hard bargaining on prices by adroit purchasers.
* Segments of the home real estate market that consumers rarely hear about, such as employe-relocation units sitting on the books of major firms and houses repossessed by lenders, offer particularly good opportunities in December and early January. Large employers who bought their relocating workers' homes during 1984 see the winter months as red ink. They are paying mortgage and property-tax costs of $1,500 to $2,000 a month on unsold homes in many cases, and they want out fast.
Now is the time to talk to the several major realty brokers in every market who handle relocation properties for employers. Many are ready to cut prices and offer exceptional financing terms on behalf of their nervous corporate clients.
Local banks, savings and loans and other lenders in your community may be in the same uncomfortable boat. Some are offering single units or packages of foreclosed properties at wholesale prices to buyers or investors who knock on the door and ask about their "REO" -- their stock of real estate owned.
"There's no question that the last few weeks of December . . . and the first couple weeks of January 1985 represent particularly opportune points" in the cycle to buy, thanks to soft rates and prices, said Peter Treadway, chief economist of the Wall Street investment banking firm of Cralin & Co. Inc.
Kevin Villani, chief economist of the Federal Home Loan Mortgage Corp., predicted that, "six months from now, the December-January period will look rather good in retrospect" for buyers.
Mortgage rates and terms may be better in the coming five to six weeks than at any time in the ensuing 11 months, Villani said.
Having fallen from nearly 15 percent last summer, fixed-rate mortgages can be obtained right now for as low as 12 1/2 percent in competitive markets. One-year adjustables are readily available in the 10 1/2 to 12 percent range.
By next spring, however, rates will be on the upswing again, Villani and other economists warn. By the end of 1985, the best available fixed rates could easily be at 14 percent or beyond.
Home prices also will be moving higher by the end of January, pulled by seasonal demands of the coming spring. With more buyers in the marketplace, more traffic through builders' showrooms and plentiful (albeit more expensive) mortgage money, prices will be less negotiable than during the quiet, early weeks of winter.