What to Expect from Mortgage Loans in 2013

If you have an interest in the Albuquerque housing market, there may be good news for you this year. Low mortgage interest rates are expected to continue well into 2013, due in part to the Federal Reserve Bank’s efforts to promote an attractive market for buyers. In the Albuquerque area, it is likely that refinancing will continue to account for the majority of mortgage loan transactions into 2013, although some purchase loan increases for real estate are also forecast.

As Ben Lucero, Owner of Indigo Mortgage states, “We have already seen rates start out 2013 higher than we ended 2012. If housing does not make a dramatic turn around, experts say rates will stay at historical lows throughout the year.”

Market average rates for 30-year fixed mortgages have dropped steadily since February 2011 and 15-year fixed mortgages are also low. Many analysts predict rates to either continue at these lower rates or to decline somewhat through the beginning of 2013. The Albuquerque housing market should undergo significant improvements throughout the year, particularly for sellers as the availability of cheap foreclosed properties declines somewhat.

During the summer months of 2012, the home price index for residential homes increased by 6.9 percent over the first months of the year. Because the majority of these sales were with housing priced at the lower end of the market, analysts have been optimistic about the long-term health and continued recovery of the real estate market in the U.S. Moreover, the Federal Bank’s monetary policy is likely to help mitigate the effects of pressure on the housing market to raise fixed-rate mortgages and keep mortgage rates surprisingly low.

Albuquerque buyers should be able to take advantage of low interest rates for fixed-rate mortgages during the upcoming months, while homeowners will enjoy lower mortgage payments after refinancing. However, some homeowners may continue to struggle to get financing because of the slump in the U.S. economy. Also, it is likely that the economy would need to recover before being in favor of sellers again.

Analysts continue to recommend buying and refinancing during periods of time when mortgage rates are low and then selling during periods when real estate is in high demand. It is anticipated in the coming year that the housing market will recover enough to tolerate slight increases in mortgage rates while the supply and demand for affordable housing balances out.

Additional factors to consider that can influence the mortgage rates during the upcoming year include the overall demand for housing, the demand for low-cost housing, housing incentives for Fixed-Term Mortgages, and Federal inflation rates.