Mortgage rates will only drop to 5% if the economy significantly worsens, leading to a flight to safety into US treasuries, and the Federal Reserve restarts quantitative easing.
"According to Bank of America, and I agree with this, the only way that we see mortgage rates down in 5% is if the economy gets really bad. According to their economists, the Fed would also have to restart quantitative easing to get mortgage rates down to 5%."
