The Mortgage Market – Week of 7/13/12


Mortgage rates continue their tumble recently, hitting all-time lows every day for the week starting July 9th, 2012. Current mortgage rates sit around 3.63% nationally for a 30 year fix rate mortgage, moving lower to 2.91% on a 15 year mortgage.

Despite the mortgage rates constant tumble as of late, that hasn’t done much to create new application demand in the market. National economic indicators released by the Mortgage Bankers Association (MBA) report that for the week of July 2nd, mortgage loan application volume decreased 2.1% on a seasonally adjusted basis.

One would expect mortgage application volume to skyrocket even with the holiday weekend due to the low rates, but that was not the case. This might be a reoccurring indicator that the purchase market has not recovered, as year over year, the Purchase Index was 3 percent lower than the previous year’s numbers.

Housing Market Still Moving Forward

However, despite the passive state of the mortgage market with the week’s incredibly low rates, it’s still a good time to invest (it seems) based on a “tipping point” seemingly occurring at the convergence of slightly rising purchase prices and historically low mortgage rates (get rates here). How long these two points will so beautifully converge is yet to be seen, but should be a conscious part of every investor’s decision making moving forward.

Buying a new property A) near a low point in real estate prices and B) at a historically low point in mortgage rates – just seems like the right way to go when considering the state of the market. Of course, this is all postulating, as every year seemingly brings new prognosticators predicting “a new bottom” of the market and also coming up strikingly, shockingly wrong.

BiggerPockets is a great place to start when making intelligent decisions about investing in real estate. The Mortgage Center has today’s rates and also an option to get a custom rate quote. Similarly, sites like offer VA specific loan rates if you have military experience in your background.

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