Mortgage Rates Ease for Second Week

Borrowers had slightly more relief with mortgage rates again this week. The 30-year fixed-rate mortgage rate dipped again, averaging 4.53 percent, Freddie Mac reports.

“The stability in borrowing costs comes despite the highest core inflation rates since 2008 and turbulence in the currency markets,” says Sam Khater, Freddie Mac’s chief economist. “Unfortunately, this pause in rates is not leading to increasing home sales.”

Freddie Mac reports the following national averages for the week ending Aug. 16:

  • 30-year fixed-rate mortgages: averaged 4.53 percent, with an average 0.5 point, falling from last week’s 4.59 percent average. Last year at this time, 30-year rates averaged 3.89 percent.
  • 15-year fixed-rate mortgages: averaged 4.01 percent, with an average 0.5 point, dropping from last week’s 4.05 percent average. A year ago, 15-year rates averaged 3.16 percent.
Source: “Mortgage Rates Step Back,” Freddie Mac (Aug. 16, 2018)

Millions of Consumers Getting a Credit Score Boost

An overhaul in how several major credit reporting agencies factor in negative credit information is prompting millions of consumers’ credit scores to rise. Collection events were struck from 8 million consumers’ credit reports in the 12 months ending in June. The New York Federal Reserve reported Tuesday that consumers who had at least one collections account removed from their credit reports are seeing an 11-point increase to their scores.

Critics have long claimed such dings to scores are prone to errors or that they’ve unfairly kept many out of the borrowing market. Equifax, Experian PLC, and TransUnion have all agreed to revamp reports, which stems from a 2015 settlement with state attorneys general on the matter. In the settlement, the firms agreed to remove some non-loan related items that were sent to collection firms, such as gym memberships, library fines, and traffic tickets. They also agreed to strike medical-debt collections that have been paid by a patient’s insurance company.

Source: “Overhaul Boosts Credit Scores of Millions of U.S. Consumers,” The Wall Street Journal (Aug. 15, 2018)

Dip in Rates Provides ‘Stability’ for Home Sales

Borrowers saw a little relief from recent increases. Mortgage rates dropped slightly this week, with the 30-year fixed-rate mortgage averaging 4.59 percent, Freddie Mac reports. “This stability is much needed for home sales, which have crested because of the multiyear run up in prices, tight affordable inventory, and this year’s higher rates,” says Sam Khater, Freddie Mac’s chief economist.

Home prices are still climbing and rates are up from 3.90 percent a year ago. “Some prospective buyers are definitely feeling an affordability crunch,” Khater says.

Freddie Mac reports the following national averages for the week ending Aug. 9:

  • 30-year fixed-rate mortgages: averaged 4.59 percent, with an average 0.5 point, dropping from last week’s 4.60 percent average. Last year at this time, 30-year rates averaged 3.90 percent.
  • 15-year fixed-rate mortgages: averaged 4.05 percent, with an average 0.5 point, falling from last week’s 4.08 percent average. A year ago, 15-year rates averaged 3.18 percent.
Source: “Mortgage Rates Inch Backward,” Freddie Mac (Aug. 9, 2018)

Another ‘Client’ to Please: The Family Pet

Home buyers are increasingly being swayed by their pets when choosing which property to purchase. Three-quarters of home buyers say they would even pass up an otherwise perfect home—their dream home—if it did not meet their pets’ needs, according to a new realtor.com® survey of more than 1,000 consumers who’ve closed on a home in 2018.

Pet owners comprised 80 percent of recent home buyers—with dogs and cats being the most common types of pet—according to the survey. Younger buyers and those with children appeared to be the most influenced by their pets’ needs when shopping for a home, according to the survey.

Pet owners gave their two most desired features in a home: a large backyard and outdoor space. Other top features pet owners say they valued in a home included a garage, large square footage, a dog run and sturdy flooring.

Source: “One of the Family: Three-Quarters of Home Buyers Would Pass Up Dream Home for Pets’ Needs,” Move Inc. (Aug. 8, 2018)

Hike in Mortgage Rates Reduces Affordability

Borrowers got stuck with higher mortgage rates again this week. Mortgage rates are now at their fourth highest level of the year, Freddie Mac reports.

“The higher rate environment, coupled with the ongoing lack of affordable inventory, has led to a drag on existing-home sales in the last few months,” says Sam Khater, Freddie Mac’s chief economist.

The Federal Reserve this week voted to hold off on raising its short-term rate, “but the embers of a strong economy potentially stoking higher inflation, borrowing costs will likely modestly rise in the coming months,” Khater adds.

Freddie Mac reports the following national averages for the week ending Aug. 2:

  • 30-year fixed-rate mortgages: averaged 4.60 percent, with an average 0.4 point, rising from last week’s 4.54 percent average. Last year at this time, 30-year rates averaged 3.93 percent.
  • 15-year fixed-rate mortgages: averaged 4.08 percent, with an average 0.4 point, increasing from last week’s 4.02 percent average. A year ago, 15-year rates averaged 3.18 percent.
Source: Freddie Mac

The Kitchen New-Home Buyers Want

New-home buyers now rank all-white kitchens—once the most in-demand aesthetic—as their second choice, below natural wood cabinetry, according to a new survey from homebuilder Ashton Woods. Respondents to the survey, who are prospective buyers planning to purchase in the next 10 years, picked distressed wood cabinetry as their third most popular choice.

They also said living space is more important to them than bedroom size. Sixty-one percent say they would trade a larger bedroom in order to get a larger living area. Hobby rooms and home offices are also on their priority list, with 67 percent of respondents saying they want an office in their next home.

Source: “Here’s What Buyers of Newly Constructed Homes Want,” The Washington Post (July 26, 2018)

The Cost of Selling Without a Real Estate Agent

You’ve heard of buyer’s remorse; but without your market expertise and sales skills to back them up, sellers who choose to sell their home on their own just may experience “seller’s regret” when they see how much less they get for their properties. FSBOs earn an average of $60,000 to $90,000 less on the sale of their home than sellers who work with a real estate agent, according to the National Association of REALTORS®. Here’s the breakdown:

  • All agent-assisted homes: $250,000 (median selling price)
  • All FSBO homes: $190,000
  • FSBO homes when buyer knew seller: $160,300

Homeowners seem to be hearing the message: Only 8 percent of sellers last year—an all-time low—chose to sell their home themselves, according to NAR’s 2017 Profile of Home Buyers and Sellers. That figure has been falling since 2004, when 14 percent of homeowners sold their own homes.

Source: “Selling Your Home Solo to Save Money? You’ll Actually Make Less Than You Think,” National Association of REALTORS® Economists’ Outlook blog (July 9, 2018)

Mortgage Rates Fall to 3-Month Low

Mortgage rates were back down across the board again this week, offering some temporary relief to home buyers. Rates posted a rapid increase throughout most of the spring but have recently reversed course, declining in five of the past six weeks to the lowest average since April.

Freddie Mac reports the following national averages for the week ending July 5:

  • 30-year fixed-rate mortgages: averaged 4.52 percent, with an average 0.5 point, dropping from last week’s 4.55 percent average. Last year at this time, 30-year rates averaged 3.96 percent.
  • 15-year fixed-rate mortgages: averaged 3.99 percent, with an average 0.4 point, falling from last week’s 4.04 percent average. A year ago, 15-year rates averaged 3.22 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.74 percent, with an average 0.3 point, falling from last week’s 3.87 percent average. A year ago, 5-year ARMs averaged 3.21 percent.
Source:

Falling Mortgage Rates Offer Affordability Relief

Mortgage rates declined this week, marking the fourth drop in the past five weeks, Freddie Mac reports.

“The decrease in borrowing costs is a nice slice of relief for prospective buyers looking to get into the market this summer,” says Sam Khater, Freddie Mac’s chief economist. “Some are undoubtedly feeling the affordability hit from swift price appreciation and mortgage rates that are still 67 basis points higher than this week a year ago.”

Freddie Mac reports the following national averages for the week ending June 28:

  • 30-year fixed-rate mortgages: averaged 4.55 percent, with an average 0.5 point, falling from last week’s 4.57 percent average. Last year at this time, 30-year rates averaged 3.88 percent.
  • 15-year fixed-rate mortgages: averaged 4.04 percent, with an average 0.5 point, which is unchanged from a week ago. Last year at this time, 15-year rates averaged 3.17 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.87 percent, with an average 0.3 point, rising from last week’s 3.83 percent average. A year ago, 5-year ARMs averaged 3.17 percent.
Source: Freddie Mac

Manufactured Homes for Affordable Housing?

Home inventory of has fallen near record lows across the country, but more consumers are in need of a place to live. Some economists say manufactured homes—also known as mobile homes or trailers—may be the answer to relieve housing shortages in some markets needing more affordable housing.

In the nation’s 100 largest metros, residents living in manufactured homes—either renting or owning—spend an average of 40 percent less on housing than those living in more traditional “stick-built” homes. The average monthly gross housing cost for a mobile home is $564, compared with $1,057 for a traditionally built home or apartment, according to the report by Apartment List. (The gross housing cost includes rent or mortgage payments and property taxes, lot rent for mobile homes, and utility costs.)

Seniors on fixed incomes may find the option more appealing. Upscale mobile home parks are popping up that are aimed at attracting the 55-plus crowd, offering spacious “double-wide” manufactured homes , community centers, and pools, among other amenities.