Happy New Year! 2010 brought with it extremely low rates...below 4% on a 30-year fixed conventional loan. I think the low rates we have been experiencing for the past 3 years has spoiled us and made many consumers settle into a confort that low rates will exist into the future. Though I dont expect rates to shoot up in 2011 I do expect the interest rates to trend higher through the year. I expect rates will stay below 5% for a few more months and then gradually move higher to settle in around the 5.5-5.75% rate through most of the year.

There isn't much to get worked up over rates in the high 5's, but compared to todays rates (or last years) that will make buying a home a little more expensive...even if prices do fall a bit further. I hope the housing market is able to get its legs under it this year and that we see the economic picture improve for those who have been affected by a layoff or income cut. I wish you a wonderful 2011...just be prepared to have a happy years with slightly higher interest rates. If your 2011 goals include a new refinance or purchaes I would suggest earlier in the year may be a better option.