Current Mortgage Rates

Maryland mortgage rates took a dip in the second quarter of 2011 according to data released by Freddie Mac. Average rates across the nation fell to less than 4.35 percent for 30-year fixed mortgage loans, getting closer to the record lows experienced in November of last year. At the same time, home prices in Baltimore also fell to almost 7 percent compared to last year.

The climate for home mortgage rates today is becoming more and more uncertain. With the recent downgrade of the US government’s credit rating, consumers could see higher interest rates on financial products such as credit cards and fixed-rate mortgages. The annual percentage rates of many mortgages are tied to the yield on different US Treasury debt instruments; now that the US credit rating has been downgraded, the yield is expected to eventually rise.

According to financial observers and analysts, the major reason behind the current low yields is the instability of the major stock exchanges. Investors in Wall Street chose the safety of US Treasury bonds over volatile stocks, thus pushing yields and interest rates down. But that trend may not last much longer.

Falling home prices in Baltimore coupled with low Maryland mortgage rates are creating a climate of incertitude among buyers. While there are many bargains to capitalize from, investors are also worried about low demand. Real estate agents complain about the number of draft contracts that expire unfulfilled. Reasonable prices and low home mortgage rates today aren’t enough to appease investors.

The record low Maryland mortgage rates and the devalued properties around Baltimore aren’t stopping real estate agents in the area from marketing aggressively. Short sales and foreclosures are in vogue among speculators, and real estate agents insist that now is the time to act. Sales of financially-distressed properties have been picking up lately as the banks aren’t able to manage large real estate portfolios. The luxury housing market in Baltimore is also showing signs of distress as foreclosures pile up.

While the Baltimore area wasn’t as badly affected by the bursting of the housing bubble in the beginning, real estate experts claim that the current environment will last for a while. Prices are down by more than 5 percent from last year, and are expected to keep dropping in the weeks to come.