Long-term rates have continued a modest retreat from the December highs, 10-year Treasurys to 3.67 percent, mortgages sliding toward 5 percent.

Further improvement depends on Fed Reserve and Treasury policy regarding 1) their desire to get the Fed out of the MBS-buying business, 2) the embalmed state of Fannie and Freddie, 3) private markets closed to mortgages, and 4) the slowly collapsing theory that housing and the economy are in self-sustaining recovery. A financial-market accident somewhere would do the trick, too.

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