Rates Hover Near All-Time Lows

Borrowing costs moved lower this week as the 30-year fixed-rate mortgage averaged 3.6%, Freddie Mac reports. Rates are at the lowest levels in three months and about a quarter-point above all-time lows. “The very low rate environment has clearly had an impact on the housing market, as both new construction and home sales have surged in response to the decline in rates, the rebound in the economy, and improving financial market sentiment,” says Freddie Mac Chief Economist Sam Khater.

Freddie Mac reported the following national averages for the week ending Jan. 23:

  • 30-year fixed-rate mortgages: averaged 3.6%, with an average 0.8 point, falling from last week’s 3.65% average. Last year at this time, they averaged 4.45%.
  • 15-year fixed-rate mortgages: averaged 3.04%, with an average 0.8 point, dropping from last week’s 3.09% average. A year ago, they averaged 3.88%.
Source: Freddie Mac

Slight Uptick in Mortgage Rates

“By all accountsmortgage rates remain low and, along with a strong market, are fueling the consumer-driven economy by boosting purchasing power, which will certainly support housing market activity in the coming months,” says Sam Khater, Freddie Mac’s chief economist.

The National Association of REALTORS® released a study this week showing how high home prices are stymieing job growth in some metro areas.

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

  • 30-year fixed-rate mortgages: averaged 3.65%, with an average 0.7 point, rising slightly from last week’s 3.64% average. Last year at this time, 30-year rates averaged 4.45%.
  • 15-year fixed-rate mortgages: averaged 3.09%, with an average 0.7 point, inching up slightly from a 3.07% average. A year ago, they averaged 3.88%.
Source:

Mortgage Rates Drop

“Mortgage rates fell to the lowest level in thirteen weeks, as investors sought the quality and safety of the U.S. Treasury fixed income markets,” said Sam Khater, Freddie Mac’s Chief Economist. “The drop in mortgage rates, combined with the strong labor market, should propel a continued rise in homebuyer demand.”

News Facts:

  • 30-year fixed-rate mortgage averaged 3.64 percent with an average 0.7 point for the week ending January 9, 2020, down from last week when it averaged 3.72 percent. A year ago at this time, the 30-year FRM averaged 4.45 percent.
  • 15-year fixed-rate mortgage averaged 3.07 percent with an average 0.7 point, down from last week when it averaged 3.16 percent. A year ago at this time, the 15-year FRM averaged 3.89 percent.

Source: Freddie Mac

New Home Loan Limits Take Effect

The Federal Housing Finance Agency’s new loan limits for 2020 have gone into effect; Fannie Mae and Freddie Mac, which are operated by the FHFA, began backing larger loans last week when the new year started. The cap on Fannie and Freddie loans has increased to $510,400 from 2019’s $484,350 limit.

View a breakdown of loan limits by county for Fannie and Freddie.

The Federal Housing Administration also increased its loan limit to $331,760, which is a $17,000 increase from 2019. In about 70 designated high-cost counties, the FHA’s 2020 loan limit has climbed to $765,600, a $40,000 increase from 2019. Alaska, Hawaii, Guam, and the U.S. Virgin Islands have higher limit ceilings than the rest of the country, the FHA says. Those areas have a 2020 FHA loan limit of $1,148,400.

View a breakdown of loan limits by county for the FHA.

Source: “FHA, Fannie Mae, Freddie Mac Are All Now Backing Larger Loans,” HousingWire (Jan. 2, 2020)

Home Loan Interest Rates Drop

What a difference a year makes. Home shoppers are being greeted with much lower mortgage rates to kick off 2020 than they were a year ago. The 30-year fixed-rate mortgage averaged 3.72% this week, compared to 4.51% at the beginning of 2019.

“The stability is welcome news after the interest rate turbulence of the last year, which caused a slowdown in the housing market and other interest rate-sensitive sectors,” says Sam Khater, Freddie Mac’s chief economist. “The low mortgage rate environment combined with the red-hot labor market is setting the stage for a continued rise in home sales and home prices.”

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

  • 30-year fixed-rate mortgages: averaged 3.72%, with an average 0.7 point, falling slightly from a 3.74% average a week ago. Last year at this time, 30-year rates averaged 4.51%.
  • 15-year fixed-rate mortgages: averaged 3.16%, with an average 0.7 point, dropping from last week’s 3.19% average. A year ago, they averaged 3.99%.
Source: Freddie Mac

Mortgage Rates Remain Stagnant

This week, the average U.S. fixed rate for a 30-year mortgage held steady at 3.73%. Although this rate remains the same as last week’s percentage, it’s still more than a percentage point below the 4.55% of the year-earlier week, according to the Freddie Mac Primary Mortgage Market Survey.

The 15-year FRM averaged 3.19% this week, remaining unchanged from last week’s rate. This time last year, the 15-year FRM came in at 4.01%.

Although rates continue to hover near historic lows, Sam Khater, Freddie Mac’s Chief Economist, warns a lack of housing supply is likely to dampen home sales in 2020.

Source: Freddie Mac

Mortgage Rates Tick Up

“With Federal Reserve policy on cruise control and the economy continuing to grow at a steady pace, mortgage rates have stabilized as the market searches for direction,” said Sam Khater, Freddie Mac’s Chief Economist. “The risk of an economic downturn has receded and, combined with the very strong job market, it should lead to a slightly higher rate environment.”

  • 30-year fixed-rate mortgage averaged 3.73 percent with an average 0.7 point for the week ending December 12, 2019, up from last week when it averaged 3.68 percent. A year ago at this time, the 30-year FRM averaged 4.63 percent.
  • 15-year fixed-rate mortgage averaged 3.19 percent with an average 0.7 point, up from last week when it averaged 3.14 percent. A year ago they averaged 4.07 %.
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.36 percent with an average 0.4 point, down from last week when it averaged 3.39 percent. A year ago at this time, the 5-year ARM averaged 4.04 percent.

Source: Freddie Mac

Mortgage Rates Stay Steady

“This week the economy sent mixed signals, leaving mortgage rates unchanged,” says Sam Khater, Freddie Mac’s chief economist. “Survey data for manufacturing and service industries varied while construction spending fell modestly. However, homebuyer demand continued to improve, rising eight percent. Clearly, home buyers remain bullish on the real estate market.”

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

  • 30-year fixed-rate mortgages: averaged 3.68%, with an average 0.5 point, holding the same as last week. Last week at this time, 30-year rates averaged 4.75%.
  • 15-year fixed-rate mortgages: averaged 3.14%, with an average 0.4 point, falling slightly from last week’s 3.15% average. A year ago, they averaged 4.21%.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.39%, with an average 0.4 point, falling from last week’s 3.43% average. A year ago, they averaged 4.07%.
Source: Freddie Mac

Mortgage Prepayments Climb

Mortgage prepayments, a common gauge for housing and refinancing demand, jumped to its highest level since May 2013—a good sign for the market, according to a new analysis from data and analystics firm Black Knight. Mortgage prepayments were at 1.81% in October, more than double the figure a year ago. That represents a 134% year-over-year increase, Black Knight reports.

What’s causing the improvement? Low mortgage rates are prompting more people to refinance their mortgage or buy a home. Consumers typically pay off previous loans when they buy a new home.The uptick is apparent: Existing-home sales increased 1.9% in October to a seasonally adjusted annual rate of 5.46 million—4.6% higher than a year ago, the National Association of REALTORS® reported last week.

Source: “Mortgage Prepays Surge to 6-Year High, Black Knight Says,” HousingWire (Nov. 25, 2019)

Home Loan Interest Rates Rise

“The modest uptick in mortgage rates over the last two months reflects declining recession fears and a more sanguine outlook for the global economy,” says Sam Khater, Freddie Mac’s chief economist. “Due to the improved economic outlook, purchase mortgage applications rose fifteen percent over the same week a year ago, the second highest weekly increase in the last two years. Given the important role residential real estate plays in the economy, the steady improvement of the housing market is a reassuring sign that the economy is on solid ground heading into next year.”

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

  • 30-year fixed-rate mortgages: averaged 3.75%, with an average 0.6 point, rising from last week’s 3.69% average. Last year at this time, they averaged 4.94%.
  • 15-year fixed-rate mortgages: averaged 3.2%, with an average 0.5 point, rising rom last week’s 3.13% average. A year ago, 15-year rates averaged 4.36%.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.44%, with an average 0.4 point, rising from last week’s 3.39% average. A year ago, they averaged 4.14%.
Source: Freddie Mac