Saturday, August 25, 2007

Good News: Mortgage Rates Remain Low and Stable

The housing market woes have received a lot of attention lately, but the graph above (click to enlarge) suggests that it could be a lot worse if interest rates weren't so low and stable. Mortgage rates today at 6.52% (average this week) are a relative bargain compared to previous decades likes the 1970s when the average was 8.9%, the 1980s (avg=12.70%), and the 1990s (avg=8.12%). Since 2000, 30-year mortgage rates have averaged 6.49%, about where they're at right now, which is almost 3% below the 1971-2007 average.

As soft as the real estate market is right now, imagine what it would be like if mortgage rates were the average of 9.22% instead of 6.52%!


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