Third Time Is the Unlucky Charm?
Mortgage Rates Are on the Rise
According to Freddie Mac, the U.S. housing agency which sells guarantees for home loans, this week's 6.03 percent for 30-year mortgages is the second highest level of the year. Thirty-year rates were at 6.04 percent in the March 31 week.Unfortunately, when prices are in a discernible trend, either up or down, breaking a significant barrier for a third time usually means that barrier is toast.This week is also the third time this year mortgage rates are above 6 percent - an important psychological level. When rates were below 6 percent, this helped spur home buying and refinancings of home loans that allowed Americans to spend their way out of the most recent economic downturn.
I doubt we see rates below six percent for a good while now. Next question: How long do the "funny mortgage loan" folks hold out?
UPDATE: There is one line of thought that thinks this is good short term news for the mortgage market, as people scramble to get into new arrangments to ride out the long haul. Could be something to that, too.