Home Loan Interest Rates Stuck in Holding Pattern

Mortgage  rates barely budged this week, staying well below the 4 percent mark. “Rates held relatively flat this week,” says Freddie Mac Chief Economist Sean Becketti. “The 10-year Treasury yield fell just 1 basis point, while the 30-year mortgage rate remained unchanged at 3.83 percent.”

Freddie Mac reported the following national averages for the week ending Sept. 28:

  • 30-year fixed-rate mortgages: averaged 3.83 percent, with an average 0.6 point, holding the same as last week. Last year at this time, 30-year rates averaged 3.42 percent.
  • 15-year fixed-rate mortgages: averaged 3.13 percent, with an average 0.5 point, also holding the same average as last week. A year ago, 15-year rates averaged 2.72 percent.

Source: Freddie Mac

Home Loan Interest Rates Maintain Yearly Lows

Great news! Mortgage rates mostly held at last week’s year-to-date lows, offering another opportunity for borrowers to take advantage of savings. Ask a local lender for what is your best type of loan.

“The 30-year mortgage rate, however, remained unchanged at 3.78 percent. If Treasury yields continue to rise, mortgage rates could see an increase in next week’s survey,” says Freddie Mac chief economist Sean Becketti.

Freddie Mac reports the following national averages for the week ending Sept. 14:

  • 30-year fixed-rate mortgages: averaged 3.78 percent, with an average 0.5 point, holding the same average as last week. Last year at this time, 30-year rates averaged 3.50 percent.
  • 15-year fixed-rate mortgages: averaged 3.08 percent, with an average 0.5, the same average as last week. A year ago, 15-year rates averaged 2.77 percent.

Source: Freddie Mac

Hispanic Homeownership Surges

Hispanics are increasingly making up what’s considered the typical American home buyer, Curbed.com reports. Latinos are expected to make up 52 percent of new home buyers between 2010 and 2030, largely driven by the country’s 14.6 million Latino millennials.

“The fact is the majority of Latinos want to be home owners and will make up half of all new home buyers in the next 20 years,” Scott Astrada, director of federal advocacy at the Center for Responsible Lending, told NBC. “They have a central place in the housing market and finance system.”

Harvard University Joint Center for Housing Studies’ “State of the Nation’s Housing” study predicts minorities overall will drive three-quarters of the gains in U.S. households. Latinos will likely account for one-third of those increases alone.

Source: “Booming Hispanic Homeownership Helping Fuel U.S. Housing Market,” Curbed.com (Sept. 5, 2017)

Are Supply Woes Causing Loan Demand Drop?

The number of mortgage applications for home purchases continues to underwhelm, despite rates being at their lowest levels since November. Mortgage applications for purchasing a home dropped 3 percent last week on a seasonally adjusted basis.

The annual gain in purchase applications remains positive (4 percent higher than a year ago), but they’re narrowing as the supply of homes for sale falls and makes it tougher for buyers to find and afford a home, CNBC reports.

Meanwhile, current homeowners may be holding out for even lower rates. Refinancing application volume dropped 2 percent last week and is down 41 percent from a year ago, when mortgage rates were lower.

Source: “Weekly Mortgage Applications Drop 2.3% as Borrowers Wait for Lower Rates,” CNBC (Aug. 30, 2017)

30-Year Mortgage Rate Hits New 2017 Low

Borrowers applying for a 30-year fixed-rate mortgage this week locked in the lowest rate of the year, as it dropped to its lowest average since November 2016, Freddie Mac reports. Additionally, “the 10-year Treasury yield fell 6 basis points this week amid concerns over lagging inflation,” says Freddie Mac chief economist Sean Becketti.

Freddie Mac reported the following national averages for the week ending Aug. 24:

  • 30-year fixed-rate mortgages: averaged 3.86 percent, with an average 0.5 point, dropping from last week’s 3.89 percent average. Last year at this time, 30-year rates averaged 3.43 percent.
  • 15-year fixed-rate mortgages: averaged 3.16 percent, with an average 0.5 point, the same average as last week. A year ago, 15-year rates averaged 2.74 percent.

Source: Freddie Mac

Report: Kids Have Big Say in Real Estate

Buyers with children put more weight on the neighborhood, local schools, and size of homes when shopping for the right property, according to the 2017 Moving With Kids report, produced by the National Association of REALTORS®.

The neighborhood, in particular, has a big influence on home buyers with children under the age of 18. Forty-nine percent of buyers who have children consider the neighborhood based on the quality of the school district, and 43 percent choose a neighborhood by the convenience to schools.

Sellers with kids also have unique needs. One notable need is that they usually have to sell their homes faster. Twenty-six percent of owners with children under the age of 18 sold their home urgently compared to 14 percent of owners with no children at home. The main reasons for selling a home for sellers with children were that the home was too small or they faced a job relocation or a change in their family situation.

Source: “2017 Moving With Kids,” National Association of REALTORS® (Aug. 21, 2017)

Home Loan Interest Rates Are Hovering Below 4%

Mortgage rates posted another drop this week, offering more relief to home buyers.

Freddie Mac reports the following national averages for the week ending July 27:

’30-year fixed-rate’ mortgages: averaged 3.92 percent, with an average 0.5 point, falling from last week’s 3.96 percent average. Last year at this time, 30-year rates averaged 3.48 percent.

’15-year fixed-rate’ mortgages: averaged 3.20 percent, with an average 0.5 point, dropping from last week’s 3.23 percent average. A year ago, 15-year rates averaged 2.78 percent.

Source: Freddie Mac

After Brief Hike, Mortgage Rates Fall Below 4%

Following two weeks of rate increases, the 30-year fixed-rate mortgage settled back below a 4 percent average this week.

“Continued economic uncertainty and weak inflation data pushed rates lower this week,” says Sean Becketti, Freddie Mac’s chief economist.

Freddie Mac reported the following national averages for the week ending July 20:

  • 30-year fixed-rate mortgages: averaged 3.96 percent, with an average 0.6 point, dropping from last week’s 4.03 percent average. Last year at this time, 30-year rates averaged 3.45 percent.
  • 15-year fixed-rate mortgages: averaged 3.23 percent, with an average 0.5 point, falling from last week’s 3.29 percent average. A year ago, 15-year mortgage rates averaged 2.75 percent.

Source: Freddie Mac

The Real Costs of Tiny Homes

The tiny home movement—homes that often fall within the 100- to 400-square-foot range—is becoming more trendy as owners are drawn to the homes’ minimalism and sliced costs. But buyers may not want to count on cutting their savings by purchasing a tiny home.

A tiny home usually has more costs up front. If you build it yourself, the average cost is about $23,000, according to The Tiny Life. This usually doesn’t include the land price, so buyers will need to pay more to purchase a plot of land or lease land for the home. Additionally, about 68 percent of tiny home owners don’t have a mortgage at all, compared to just 29.3 percent of buyers of traditional homes.

Tiny-home living promotes less spending on utilities as an added perk, but buyers will need to watch those upfront payments as well. Tiny homes often use alternate forms of energy, such as propane, solar energy, or composting. Even for a tiny house, a solar-power system can cost about $8,000, according to The Financial Times.

Source: “Tiny House Living: How Much Money Can You Really Save?” CheatSheet.com (July 11, 2017)

Labor Shortage Causes Headaches for Builders

Buyers eyeing newly constructed homes may need to brace for building delays and higher prices due to an ongoing labor shortage. About two-thirds of homebuilding contractors say they’re struggling to finish projects on time because of the labor shortage, according to a new survey sponsored by USG Corp. and the U.S. Chamber of Commerce. More than one-third say they sometimes have to turn projects down.

“There is reason for concern in the lack of qualified talent,” says Tom Donohue, CEO of the Chamber of Commerce. Further, more construction projects are being started with an insufficient number of workers. Construction spending zoomed to $359.5 billion in the first four months of this year, which is 5.8 percent higher than the same period in 2016, according to Census data.

During the housing downturn, many workers left the industry for other employment and have not returned. Also, the construction workforce is aging ,says Steve Jones, senior director of Dodge Data & Analytics. “You have an aging workforce in an industry that doesn’t lend itself to long careers because it’s hard, physical work, and then you lose a whole bunch of people.”

Source: “Labor Shortage Squeezes Real-Estate Developers,” The Wall Street Journal (June 27, 2017) [Log-in required.]