Mortgage Rates - How Low Can They Go?



 This week both 15-year and 30-year mortgages fell to new record lows. It is actually the 6th week in a row for such records!  Will it have the desired effect to bring the housing industry around?  Many attribute the modest gains to the fact that rates have remained under 4% since December for 30-yr loans. Another stimulus to the economy would occur if people choose to take advantage of the rates and refinance.

According to Freddie Mac, this week the 30-yr loan dropped to a record low of 3.67% (down from 3.75% last week).  The 15-year mortgage often chosen as a refinance option also declined to 2.94% (down from 2.97% last week).  Mortgage rates tend to track the yield on the 10-yr Treasury note.  This number fell last week to a 66-yr low!  To check rates or comparison shop for a loan, be sure to use our Mortgage Finder.

This is interesting news when over 62% of the sales in Pinellas County here in Tampa Bay have been all-cash purchases.  Many of our clients who would require a mortgage are either having difficulty qualifying for a home loan or not able to afford the larger down payments required by the banks.  None of the analysts are predicting rates to fall further. Actually 23% of the experts expect rates to increase over the next week.

With the demand for long term luxury rentals continuing to increase... we can see first hand the number of potential buyers who have opted instead to rent for awhile. This should be a very interesting trail to follow...