Mortgage rates  have continued to remain low throughout the summer months. With the 30 year fixed rate at 4.125% and the 15 year fixed rate at 3.625%, one would expect that potential home borrowers would be waiting in line at banks to secure their mortgage. This is not the case today as mortgage rates are not moving the housing market in the direction that it should be going under normal circumstances.

There are several factors that can be blamed for the continued depressed housing market. Without knowing which way housing prices will go, buyers are not looking at purchasing a home as a way to make money and to secure their financial future. As housing prices continue to fall, it will take many years before a buyer will see any equity in their home. Many buyers are still waiting to see if housing prices continue to drop at which point there may only be foreclosures and short sales available.

Some buyers do not want to deal with the problems with purchasing a foreclosure or a short sale. The time and paperwork involved for these homes is stressful and only the beginning of a long journey. The cost associated with potential repairs and maintenance involved with foreclosures is another drawback. Because of this, buyers, who have the upper hand in this market, are looking to purchase homes currently owned and occupied by sellers at the same prices as those offered for foreclosures and short sales. Sellers, on the other hand, are not willing to reduce their prices to those levels. By doing that, many sellers would have to bring cash to the closing table which many are unwilling or not in the financial position to do. With millions of homes in negative equity, sellers are sitting tight on their homes instead of taking a devastating financial hit.

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