Mortgage Rates Today: Mortgage Rates Stabilized as Housing Market Stalls (VIDEO)
By: Ed Ferrara
Mortgage rates have stabilized as the news for housing gets more and more bleak. In December we saw the biggest drop in existing home sales month over month in 40 years. The national median home price tanked 12% in just a month, that’s a record. Why? It’s not because of rising mortgage rates. For most of December we saw near record low mortgage rates. 30 year fixed mortgages in the month of December rose off record lows but remained below 5% at par. The real culprit in the housing slow down is the home buyer tax credit extension. It was due to happen. The government extended the home buyer tax credit which took pressure of buyers to buy now. The tax credit is extended into April slowing down December home sales but sure to provide a boost in the first quarter of 2010.
Prices of mortgage backed securities which drive mortgage rates in the opposite direction, have been relatively flat today. 30 year fixed mortgage rates today are as low as 4.75% at par, while national averages are being reported around 5%. FHA 30 year fixed mortgage rates are even better than conforming, but come with higher costs. Today’s jumbo 30 year fixed rate at par is 5.75%, where it’s been for much of the past few months. Economists from Morgan Stanley and Goldman Sachs to name a few have predicted a large increase in mortgage rates in 2010.
Below is a video detailing the drop in sales and home prices in December. Click to play.
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