A lack of demand for new mortgages is keeping rates around record lows, under 4% on 30-year fixed rate mortgages for folks with great credit scores.
There’s yet to be an uptick in home sales as a result of these low interest rates.
More: The low rates have done little to boost the struggling housing market. Rates have been below 5 percent for all but two weeks in the past year. Yet few people can qualify for the rates and many of those who can have already done so.
And prospective buyers don’t want to put money into a home that they fear could fall in price over the next few years.
Sales of previously occupied homes were dismal last year. New-home sales in 2011 were the worst on records going back half a century.
Builders are hopeful that the low rates could boost sales this year. But so far, they have had a minimal impact.