Low Mortgage Rates Will Disappear Next Year, Trade Group Says
Low Mortgage Rates Will Disappear Next Year, Trade Group Says
Mortgage rates will begin increasing next year, the Mortgage Bankers Association predicts.
Mortgage rates, recently down to about 4.5 percent for the 30-year fixed-rate mortgage, will rise to 4.8 percent in the second quarter of 2011, then to 5 percent in the third quarter before surpassing the 5 percent mark by the end of next year, according to the MBA's Mortgage finance forecast released yesterday at a the group's annual convention in Atlanta. Find current mortgage rates.
Mortgage rates for the 30-year fixed, probably the most common home loan product, will continue increasing through out 2012, rising to 5.7 percent.
The Federal Reserve plans another round of quantitative easing, a fancy phrase for pumping more money into to the economy, in at attempt to drive down interest rates and stimulate the economy. The Fed is expected to purchase large amounts of U.S. Treasuries to decrease mortgage rates and other types of interest rates. But the Fed's actions are already priced into mortgage rates, said Jay Brinkmann, the MBA's chief economist. The Fed, according to Brinkmann, would have to make an unexpected "blockbuster" announcement to push mortgage rates much lower.
If the MBA prediction is correct, this year is the best time for homeowners to refinance their mortgages into lower rates.
Existing-home sales will increase slowly through 2011, rising from 4,026 in the third quarter of 2010 to 5,051 to the fourth quarter of 2011, the MBA predicts.
The national average for home prices will probably fall slightly next year, but that figure is being weighed down by severely distressed housing markets, such as Florida and some areas of California. Some areas, Brinkmann said, are showing signs of increasing home prices. Learn about mortgage for purchasing a home.
The median price of existing homes, at $218,900 in the second quarter this year, will increase to $173,500 by the end of next year.
The MBA predicts that the volume of mortgage refinancings will reach 921 billion this year and 370 billion in 2011. Mortgages for home purchases will amount to 480 billion this year and 626 billion in 2011.
Yields for the 10-year Treasury, which are typically used to set mortgage rates, will increase to 3.3 percent by the end of 2011. Train Online for Careers in Arts and Design Find Custom Greeting Cards Online TTS Consulting's Online Trading Systems Revealed Want to make money online properly? Folks In The UK Can Buy Things Online From The USA And Vice Versa! Good Luck Amulets, Mojo Bags, Anything Really! A Few Essentials You Should Know About Making Money Online Ways To Undertake Online Directory Distribution and What It Stands For Much Needed Tips For Succeeding as an Online Advertiser Where to watch saw 3d online? Atlanta Massage Envy Online Reviews Increasing Online Success with a Solid Reputation Watch 2010 World Series Live Online - How to Watch the 2010 Baseball World Series Live Online Via Live Stream How to Increase Traffic to your Blog and Make Real Money Online