Just to be clear, mortgage interest rates are not awful. Interest rates reached their highest point in modern history in October 1981 when they peaked at 18.63 percent, (that would be considered awful!) according to Freddie Mac data. Fixed mortgage rates declined from there, but they finished the decade at around 10 percent. Right now average rates (depending on credit score, etc.) are as follows:
30-yr fixed 7.412%
15-yr fixed 6.442%
No, we aren't at the 3 percent we were a few years ago but there is no reason to think we will get there anytime in the near future. Looking back as far as 1973 there are only a few years when we went that low, more often than not rates were MUCH higher. Bankrate has an interactive chart showing rates. The bottom line is focus on your real estate goals and not the interest rate. Should rates drop in the future you can always refinance. If you wait for them to drop you could sacrifice many years of appreciation and equity and come out well behind where you would be if you got into the market now.
California's "Dream For All" Relaunching