Great news for Arizona luxury home buyers and Arizona luxury home sellers too!

Just a year ago, the average rate on a 30-year jumbo mortgage””a loan of more than $729,750 not backed by government-sponsored agencies Fannie Mae or Freddie Mac””was 6.86%, according to Greg McBride, a senior financial analyst at Bankrate.com. Now it is 5.48%””a rate that rivals those available during the height of the credit bonanza.

Let’s see, the median home prices in most luxury home zip codes in the Phoenix area are similar to 2003 or 2004 prices (not adjusted for inflation so really 2010 prices are lower than the 2003/2004 prices in real terms), and the interest rate on luxury home loans is the lowest since 2003.

Boy, the Arizona luxury home market is now an entirely different market than it was even last summer!