The reason we can reasonably assume that demand will continue to be very strong is clearly illustrated in the chart below. Let's look at mortgage rates. When we look back over the past two years at interest rates, we can see that almost every single week — it is a little lower than it was the previous week. However, It seems like we are bottoming out right now at about the three and half percent rate.
But wait, there are projections which indicate that mortgage rates may begin inching up over the next year through 2013.
In my next post let's explore home affordability and prices versus interest rates.