Mortgage Rates Fluctuating, But Staying Near 5.00%

By: Katie Curnutte, Zillow PR Manager | December 30, 2008

Rates for 30-year fixed mortgages have been up and down over the past week, but are staying close to the 5.00% mark. The average mortgage rate last week was 5.07%, close to the current rate on Zillow Mortgage Marketplace of 5.09%.

As you can see from the chart above, rates have really been up and down this month. The average mortgage rate for a 30-year fixed two weeks ago was 4.96%, and when I checked Zillow Mortgage Marketplace at around 2 p.m. Pacific time yesterday, the rate was 4.92%.

One of the brokers who blogs on Mortgages Unzipped said last week that waiting for rates to drop any further might not be the best bet. Check out his blog post here.

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Categories: Mortgages

Comments

7 Comments so far

DebtFree on December 30, 2008 3:05 pm

Great news, all we need now are home prices to hit bottom after another 30% drop in prices, where median salaries for a given area can actually afford debt service on median priced homes:

graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif

One year down, 3 more to go!
DebtFree on December 30, 2008 3:13 pm

As for interest rates rising, one can always refinance later to a lower rate, but that $700,000 purchase price is forever.

Much better to pay a lower price, than take on a massive mortgage in an environment of rising interest rates (assuming the rates will rise as ‘buy now’ proponents claim), where resale becomes impossible for many years without the seller bringing a large check to the closing table.

As an example, say you buy that $700,000 shack in California today with a 5% mortgage. Then you want to sell in 2 years (lost your job due to recession) when interest rates are at 7%. Well, now you need to find a buyer who can swing $700,000 (or more) at the higher 7% rate, during a recession. Seem likely?

Buying at inflated prices guarantees either financial serfdom, or escape via foreclosure.
Brad Correll on December 31, 2008 9:57 am

Falling rates is a big plus, but more help from the government will be needed to spark this market. A stimulus package needs to be implemented that will encourage home buying. By offering huge tax rebates to new home buyers it will spark a wave of home buying that will absorb all the property sitting on the market and stabilize home prices. That money will be better spend than bailing out the banks!
dona kelly on January 3, 2009 2:36 pm

you are full of crap
myrtle beach rentals on January 3, 2009 3:21 pm

we are seeing rates at 5% but why are we not seeing buyers getting this 5% rate?
Edmonton Real Estate on January 5, 2009 12:07 pm

Seems like banks are still a little hesitant to lend at these rates, I’m sure that will change over the course of 2009.

Ryan Philipenko - Real Estate in Edmonton
Anonymous on January 6, 2009 10:37 pm

Well, if you are going to sit around and wait for rates and home prices to drop even further, I think you are barking up the wrong tree. I think that now is the time to make the move on buying a home while property values and rates are still low. 2009 could bring an upswing not only to the rates but to home prices. We have been living in a depressed and falling home price market for too long and before you can blink an eye, home values could shoot up and those waiting for the “bottom” will have missed their opportunity. No one can time the market and pent up demand is going to unleash and pour forth I have no doubt in the very near future. Just my opinion for what it’s worth and you don’t have to agree. If you are in the market to be in your home for a period of time and not trying to “flip”, you will do better than okay…I’d say now is “golden” for buyers…….later in 2009 may be “silver”.