Homebuyers will likely try to take advantage of low rates this week since analysts predict interest rates are headed up this year.
According to Freddie Mac’s weekly mortgage market survey, low interest rates on mortgages are not yet a thing of the past. This week, the GSE predicts that mortgage rates will actually decline slightly after rising earlier this month. Of course, relatively speaking, even March’s slight rise was actually pretty darn near historic lows; the 30-year fixed-rate mortgage has remained solidly below four percent for more than a year.
Last week, 30-year fixed-rate mortgages averaged 3.54 percent (vs. last year’s 4.08 percent) and 15-year fixed-rate mortgages averaged 2.72 percent (vs. 3.30 percent last year). In light of the small increase week-over-week in mortgages rates earlier this month, applications for purchase loans fell four percent week-over-week (seasonally adjusted) but were still up six percent year-over-year. Fannie Mae economists have predicted that mortgage rates will rise above four percent for 30-year fixed-rate mortgages by the end of 2013. The National Association of Realtors (NAR) reported last week that sales of existing homes hit a three-year high in February, but that number may have declined this month as interest rates rose in March.
Do you think interest rates are headed back up on any kind of permanent level, or should we consider these Fed-influenced lows the “new normal” for now?
Your comments and questions are welcomed below.
by Carole VanSickle