It seems as if everyone has finally come to the consensus that mortgage rates have only one direction in 2010 and that is up. Many will also agree that as mortgage rates continue to rise that home affordability will decline as they are inversely related.
What isn't so clear is the relationship between higher mortgage rates and the overall impact on real estate transactions.
I was watching CNBC's Diane Olick - Daily Realty Check for an update on Commercial Mortgage Backed Securities early this afternoon. Although the delinquency rates are even more frightening in commercial real estate, the tail end of her update is what Realtors in the residential arena really need to pay attention.
Did you catch that?
Mortgage applications hit a six month low as mortgage rates increased during the holiday week of Christmas. 23% less as mortgage applications came to a halt. It should be noted that since mortgage rates hit their all time low near Thanksgiving weekend, a 30 year fixed home loan rate had increased by 0.500% - 0.625% to end 2009.
If a half percentage increase in residential home loan rates could impact mortgage applications by 23 percent...
How Will Your Real Estate Business Be Affected by Higher Mortgage Rates?
Five Recent Blog Posts of Interest:
- This Is The Week Ahead for January 3rd
- Weekly Blog Update for the Week Ending January 2nd
- Will You Make A Difference with Your Life in 2010
- Don't Miss Virtual RE BarCamp on January 4th
- How Will Higher Mortgage Rates Impact the Housing Recovery
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