Over the past few weeks, mortgage rates have been steadily rising to near 12 month highs.  Rates took a bit of a dip this week, but it wasn’t anything to get too excited about.  According to the experts at Mortgage News Daily, next week’s FOMC events will probably set the trends moving forward.  At a minimum, we hope rates stabilized.  Despite the rise in rates, let’s keep things in perspective.  During the biggest real estate boom in a generation, rates were in the high 5s to low 6% range.  According to MND, the average rate on a 30-year fixed rate mortgage is near 4%.  Read more below:

Mortgage rates moved decidedly lower in most cases, bringing them to their lows of the week on average.  The bond markets that drive rate changes showed solid determination in spite of a batch of economic data that would normally suggest higher rates.  In fact, a few lenders are slightly higher in rate vs yesterday, but that speaks more to the stratification of pricing and strategies between lenders than to the broader consensus.  Most lenders were in better shape, some of them significantly, but none so much so that it suggested a change to the conventional 30yr Fixed best-executionrate of 4.125%.

Every time in the past month and a half that we’ve experienced a day like today (which have been few and far between), we’ve discussed the prospects for an ongoing rise in rates and the opportunity presented by these periods of consolidation or correction.  Every time we note the “hope” inherent to such periods–both intellectual and emotional–and emphasize that they continue to be better viewed as opportunities to lock as opposed to signs of a bounce.  During a trend higher in rates, this outlook can only serve you poorly one significant time, when and if markets bounce back in the other direction.  While that can (and some would argue “should”) happen, we won’t truly be able to confirm that until after next Wednesday’s FOMC events.  Between now and then, volatility remains possible, and opportune dips far from guaranteed.Calculator4