Real Estate Industry Still Fragile As Mortgage Rates Plummet
Mortgage rates have dropped again for the 30 year fixed loan which is one of the most widely used investment vehicles for home buyers.
Only a week ago the 30 year mortgage rates were averaging 4.49 percent and now they have dropped further to 4.37 percent. To many onlookers this is seen as another small but futile attempt to kick-start the ailing real estate industry.
Home sales remain stagnant; foreclosures look to remain on the rise in the near future and new home construction has fallen dramatically due to direct competition from the huge number of foreclosures at bargain basement prices. Why build if you are in the position to pick up a near new home at an amazing discount?
The latest data shows that borrowers involved in the government’s mortgage-aid program have dropped out at twice the rate of those opting in to take advantage of loan modifications for the month of June. Reportedly, many home owners that had been accepted into the program were still unable to meet the new lesser mortgage payments and eventually succumbed to the route of foreclosure.
This is a clear indication that foreclosures are still on the rise and an everyday occurrence in the lives and minds of the normal everyday American citizen. Mortgage rates that once held the power to influence this massive market now seem to have little effect amid the confusion and turmoil this economic slump has brought with it.
How far they will fall to eventually help turn around the much needed U.S. real estate market where many millions of Americans make their living is still yet to be seen.
Analysts are now voicing fears of yet another housing slump hitting the already fragile market.
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