Mortgage Rates Will Rise Along With Housing Prices

for saleHome prices and sales will continue to rise, but historically low mortgage rates will start to fade by the end of this year, according to the National Association of Realtors.

The D.C.-based trade group’s chief economist, Lawrence Yun, sees the gains in prices continuing at a rapid pace through at least next year.

“Double-digit price gains are within reach in 2013 because inventory is bounding near 13-year lows, but some relief to inventory will occur later this year,” he said.

NAR forecasts existing home prices will rise an average of 8 percent nationwide this year and 5 percent next year.

Mortgage interest rates will gradually rise this year and next, NAR predicts, with the average rate on a 30-year fixed-rate mortgage reaching 4 percent by the end of this year and 4.6 percent next year.

Freddie Mac said Thursday the average rate on a 30-year fix was 3.51 percent this week. Average 30-year rates hit a record low of 3.31 percent in November 2012.

Courtesy of: Washington Business Journal

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