In spite of all the forecasts about higher mortgage rates happening in the latter part of 2010 (up to 6%), the unexpected strengthening of the dollar against the Euro has pushed rates down to a new low as investors are now investing in US bonds. Once yields on treasury bonds lowered, this triggered a decline in mortgage rates.
According to the Wall Street Journal article by Nick Timiraos on May 24, 2010, rates averaged 4.84% last week ending May 20, 2010. Rates were around 5.27% in April.
Why is this important?
Remember my previous blogs? I explained that for every one point in increase or decline of a mortgage rate, there is a corresponding 10% increase or decline in the cost of the home. If you are a seller, you may not be forced to lower the price of your home as the monthly cost to the buyer will be less with a lower rate. (This assumes, of course, that you priced the house properly at the outset of the listing.) If you are a buyer, you can buy more house for the same monthly cost!
So, if you are in the real estate market either as a buyer or seller (or know someone who is), timing is of the essence! Lock in a low rate and let’s start looking at houses!
Posted by: 
Mary Jane Benedetto
