Last week, we reported on the Federal Reserve's renewed commitment to hold long-term rates low through the end of the year, and likely through 2012. So far, so good: mortgage lending rates once again hit a new all-time low.

You'd think that mortgage activity would be booming when the 30-year fixed-rate loan is consistently quoted below 4 percent. But that's not really the case. The mortgage lending business is good, but should be better. The market, especially for refinances, is still being held in check by negative equity and what is, in our opinion, excessively strict underwriting standards.

That said, the real issue isn't the cost of money, but the rise of risk aversion. Underwriting standards are a manifestation of risk: high risk aversion means higher underwriting standards, low risk aversions means the opposite.

In other words, we don't expect lower interest rates to spur additional lending demand. We see additional gains being spurred by a fall in risk aversion. The willingness to engage in riskier transactions, and buying a house is considered a riskier transaction because of its sheer size, is key. Risk aversion is positively correlated with uncertainty, and markets are suffering from a high level of uncertainty these days due to anemic economic and job growth.

We don't expect the housing market to back track, but for it to ratchet meaningfully forward, the underbrush of uncertainty must be swept away.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.