by Brian Burke
on Monday, November 30th, -0001 at 12:00am.
Rising interest rates in 2001?
While September saw mortgage rates at an all-time low, the Mortgage Bankers Association (MBA) doesnt expect these conditions to last much longer. MBA announced yesterday that it expects fixed mortgage rates to average about 4.4 percent in the fourth quarter of 2010, increase to 5.1 percent by the end of 2011, and head towards 5.7 percent in 2012.
In September, borrowers enjoyed interest rates as low as 4.32 percent on 30-year fixed-rate mortgages, as reported by Freddie Mac. These unprecedented rates led many homeowners to refinance. But if interest rates do rise as MBA predicts, there may be a decline in refinancing. MBA expects that refinance activity will decrease by 60 percent in 2011, and that the refinance share of originations should fall from 66 percent in 2010 to 37 percent in 2011.
Meanwhile, MBA also predicts that existing home sales will increase by a little less than 2 percent in 2011, before increasing by about 16 percent in 2012. This would lead to an increase in purchase originations, expected to rise about 30 percent in 2011, as existing home sales recover and home prices stabilize.
MBA is a national association representing the real estate finance industry. Its stated mission is to ensure the continued strength of the nation's real estate markets, to expand homeownership, and extend access to affordable housing to all Americans.
Information is deemed reliable but not guaranteed. EXPERT REALTORS® 303-955-4220
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Brian Burke | Broker | ePRO | Expert | 303.955.4220 Office | 303.710.2609 Direct | Brian@kennarealestate.com