Mortgage rates remain low fueling the flames of a scorching housing market
Mortgages rates continue to stay extremely low despite recent moves by the Federal Reserve to increase short-term interest rates.
Freddie Mac's weekly survey of mortgage rates released Thursday showed that rates on 30-year, fixed rate mortgages averaged 5.63 percent for the week ending Feb. 3, down from 5.66 percent last week.
Low mortgage rates powered sales of both new and existing homes to all-time highs in 2004, the fourth straight year that sales in both categories have set records.
All of this means that, despite fairly high prices, it is still an excellent time to purchase or refinance a home
Analysts are forecasting housing will enjoy another good year in 2005 with sales dipping by around 3 percent, a decline that would still give the country the second-highest levels for sales of new and existing homes.
To illustrate the importance of small differences in interest rates, consider the following example, using a 30-year fixed mortgage, with a principal of $300,000 and taxes and insurance of $3,500 per year.
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