Over the past few months, families considering relocation have watched as mortgage rates have continued to fall. But a new report from the Mortgage Bankers Association
says that those who continue to wait may find that rates will be increasing again in the coming weeks.
The MBA says that it expects interest rates to rise to 4.4 percent by the end of this year, and climb to 5.1 percent by the end of 2011 - a sharp turnaround from rates of 4.25 percent last week. The group says that potential action by the Federal Reserve intended to spur the economy won't affect interest rates to a great degree.
"The market has already priced these anticipated actions into today’s rates," said Jay Brinkmann, the chief economist for the MBA. "In other words, absent some blockbuster post-election announcement from the Fed on November 3rd, we do not expect to see a further decline in rates."
Potential homeowners encouraged by falling home prices, however, will see that trend continue in the coming months. A survey of more than 100 economists by Macromarkets earlier this month found that half of them don't expect prices to rebound before next year, while the rest say a price recovery won't take hold until 2012 or later.