Can interest rates keep dropping? While interest rates went up for the first quarter of 2013 and many expected this trend to continue, April has started out with a drop to 3.5% bringing us back near the record low of 3.32% reached in December of 2012. According to Fredie Mac the average interest the week of of Dec. 13, 2012 for a 30yr fixed loan was 3.32% setting a new record low down from 3.98% one year earlier. Rates have come a long way from record highs set in Oct of 1981 when the average interest rate for a 30 year fixed rate loan was 18.45%.
Now may be the perfect time to buy. Interest rates are likely to stay low for a while, but we are seeing home prices increasing for the first time in 5 years. Anyone buying in the next three months is likely to be able to say they timed the market and bought at the peak of the affordability index.