Recently, mortgage rates for both 30-year and 15-year mortgages have dropped to well below 5%. In fact, on Tuesday the Zillow blog reported the 30-year mortgage interest rate at 4.58%. That’s lower than anything the real estate market has seen since January.
It’s a far cry from the rise in rates that the media everywhere - from the tiniest local real estate blogs to the Wall Street Journal – was predicting at the end of 2010.
What’s causing the slump? It’s hard to say for sure. Global political and economic disturbances certainly play a role. The unrest in the Middle East and the tragedies in Japan have created an atmosphere of uncertainty, particularly as the West Coast waits for a radiation cloud or a large predicted earthquake. In the face of events like these, whether mortgage interest rates rise or fall ceases to be a major concern for most of the population.
And of course there’s also the fact that the housing industry as a whole simply isn’t recovering its momentum as quickly as many had hoped. The disappearance of government backing of mortgages may go off without a hitch, or it may seriously affect the future of real estate as we know it. But the job market hasn’t recovered, and buyers are still hanging back.
While this state of affairs continues, the motivated buyer’s advantage keeps getting better.