Mortgage rates hit all-time low

Written by Federal Title | 29 June 2010

The average rate on a 30-year fixed-rate mortgage dropped to 4.69 percent this week from 4.75 percent last week, the Washington Post reported. That marks the lowest level since the company started tracking the data in 1971 and breaks the most recent low set in December. Rates have hovered below 5 percent since early May.

Yet home sales are tumbling and mortgage applications are slipping. Potential buyers have retrenched, discouraged by employment fears, the recent expiration of a home buyer's tax credit and tough lending standards, industry experts said.

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0 # Saif Ali Sharhan 2010-10-08 06:02
The drop in rates clearly has done little to improve either home sales or home prices. The latest Case-Shiller data show a less than modest up-tick in home prices in their 10-market and 20-market studies. The drop from 2006 is still breathtaking.

Prices have been further depressed by sales of homes foreclosed on by banks. RealtyTrac announced today that 24% of home sales in the second quarter were foreclosed homes. The value of these sales was 26% below prices for comparable homes not in foreclosure. The inventory banks put on the market is likely to increase. Industry experts believe that the “shadow inventory” of houses owned by banks but not yet put on the market is 2 million units.
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