Mortgage rates in the United States have slipped to a new low, bolstering hopes that the beleaguered housing market will continue to strengthen.

Throughout the recession and sluggish recovery, mortgage rates have been mostly on the decline, setting several record lows along the way. This week, the average fixed-rate for a 30-year mortgage fell to 3.79 percent, according to Freddie Mac's weekly survey -- almost a full percentage point lower than at this time last year.

The declines couldn't come at a better time for the housing market, which is still bedeviled by falling prices and high foreclosures in some areas. The lower rates are giving prospective buyers an additional incentive to hit the market and building more optimism among agents and lenders.

"It feels like 2005 again," said Steve Morris, a senior loan officer with Wintrust Mortgage in Bloomington.

The recent drop in rates is largely the result of investors feeling skittish about the European debt crisis, which has prompted many of them to put their money into safer havens, such as U.S. Treasuries. Yields on those Treasuries tend to follow mortgage rates, and analysts suggest that as long as the uncertainty in Europe continues, so, too, will low rates.

Still, the declines come at a time when many people can't take advantage, because they owe more than their house's appraisal value. In other cases, they are having trouble qualifying for a mortgage.

Alex Stenback, a mortgage banker with Residential Mortgage Group in Minnetonka, said conditions are slowly improving for borrowers to get the capital they need.

"Guidelines have been relaxed in some niches," he said, noting that federal programs have opened up refinancing to many borrowers who had been previously rejected.

In fact, Stenback said, rates are so low that those who bought or refinanced a home last year might be in a position to consider doing it again. "The smart money is all over these new rates," he said., which surveys the top 10 banks and thrifts in the nation's biggest markets, said mortgage rates fell for the seventh time during the past eight weeks and a set a new record for the fourth week in a row.

Already, consumers are lining up to take advantage, according to the National Mortgage Bankers Association, as mortgage applications were up 9.2 percent for the week ending May 11.

The latest numbers suggest that this will be one of the busiest spring housing markets in several years.

During the past week, the number of pending sales was up 41 percent compared with the same time last year, according to the Minneapolis Area Association of Realtors.

Further, the buyer mix is expanding, which bodes well for the market. For the past couple of years, home purchases have been dominated largely by investors hoping for bargains, but historically low rates are drawing a rising number of traditional buyers who are now able to qualify for mortgages because of lower rates and prices.

How long rates will remain this low is unclear. said 58 percent of the mortgage analysts it surveyed said that they see little change in mortgage rates over the next week. Looking ahead, Freddie Mac said if rates were to climb, they wouldn't likely exceed 4.5 percent by the end of the year.

Many borrowers aren't taking their chances. Brian Call, president of Twin Cities-based Rubicon Mortgage Advisors, said the number of mortgages in the pipeline is up 44 percent since the end of April, with a fairly equal distribution between those hoping to buy and those planning to refinance.

Many buyers are in disbelief about the low rates, Call said, recalling a woman who requested a loan quote Friday.

"When I ran the initial principal and interest repayment for her," Call said, "she actually gasped, laughed and said, 'Are you sure you did that right?'"

Jim Buchta • 612-673-7376