Falling mortgage rates are pulling buyers back into the housing market

A sharp drop in mortgage interest rates in December may have kicked-started the spring housing market this year. Rates are a full percentage point lower than they were in October, and consumers expect them to drop further.

Confidence about mortgage rates rose sharply in December, a step up Monthly Consumer Survey by Fannie Mae. For the first time since the survey began in 2010, more homeowners in the net believe rates will fall rather than rise, according to Mark Polim, deputy chief economist at Fannie Mae.

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