Most consumers and analysts expected mortgage rates to rise sharply after the first of the year. Instead, those rates have continued to decline.

At this writing, and for the sixth consecutive week, mortgage rates were on a downward spiral as the 30-year fixed-rate mortgage hovers near its 2015-low of 3.59 percent, Freddie Mac reports.

"The 30-year mortgage rate dropped another 7 basis points this week to 3.65 percent," says Sean Becketti, Freddie Mac's chief economist. "This week's drop leaves the mortgage rate just 6 basis points above last year's low of 3.59 percent. In a falling rate environment, mortgage rates often adjust more slowly than capital market rates, and the early-2016 flight-to-quality has run true to form."

The quote was included in a special report on the subject by the National Association of Realtors.

"The 30-year mortgage rate has dropped 36 basis points since the start of the year, while the yield on the 10-year Treasury has dropped 59 basis points over the same period. If Treasury yields were to hold at current levels, mortgage rates might well sink a little further before stabilizing."

The NAR report continues:

"Freddie Mac reports the following national averages. The 30-year fixed-rate mortgages: averaged 3.65 percent, with an average 0.5 point, dropping from last week's 3.72 percent average. Last year at this time, 30-year rates averaged 3.69 percent.

"The 15-year fixed-rate mortgages: averaged 2.95 percent, with an average 0.5 point, falling from 3.01 percent last week. A year ago, 15-year rates averaged 2.99 percent. The 5-year hybrid adjustable-rate mortgages: averaged 2.83 percent, with an average 0.4 point, dropping from last week's 2.85 percent average. A year ago, 5-year ARMs averaged 2.97 percent."

Q: Are mortgage applications to finance the purchase of newly constructed homes increasing?

A: Yes. The Mortgage Bankers Association Builder Application Survey data for January 2016 shows mortgage applications for new home purchases increased by 14 percent relative to the previous month.

"By product type, conventional loans composed 67.4 percent of loan applications, FHA loans composed 19.5 percent, RHS/USDA loans composed 0.7 percent and VA loans composed 12.4 percent. The average loan size of new homes decreased from $333,182 in December to $325,806 in January.

"The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 499,000 units in January 2016, based on data from the BAS. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors," the report noted.

Q: What is the meaning of the term "home staging"?

A: Home staging is simply the process of preparing a home to make the best possible impression on prospective buyers. This includes the rearrangement of furnishings and decorative items.

The elimination of some items to create a comfortable, uncluttered appearance is often a key step in staging. All interior rooms are examined from the perspective of a prospect inspecting the property. This should include the landscaping and other "curb appeal" items.

In many cases, the homeowner (seller) can handle the staging process. In other cases the owner might contract with an independent stager.

Q: How is the commercial real estate market shaping up this year?

A: Here is one analyst's opinion on that subject:

"As 2016 gets underway, there has been a definite slowdown in the velocity of commercial real estate sales volume, per Real Capital Analytics. We expect commercial real estate to take on more of a defensive role in this environment, and as values and prices begin to level off, investors will likely benefit from it being a hard asset, as well as from its strong income flow, especially if long-term interest rates and 10-year Treasury rates remain low, as expected."

The above quote was included in a report from the National Association of Realtors.

To find out more about Jim Woodard and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com. Jim Woodard's email: [email protected].

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