Mortgage Rates Increase

“Purchase mortgage applications up nine percent from a year ago. The improved demand reflects the still healthy underlying consumer economic fundamentals such as a low unemployment rate, solid wage growth and low mortgage rates. While there has been a material weakness in manufacturing and consistent trade uncertainty, so far, the American consumer has proved to be resilient with solid home purchase demand,” says Sam Khater, Freddie Mac’s Chief Economist.

Freddie Mac reports the following national averages for the week ending Sept. 12:

  • 30-year fixed-rate mortgage averaged 3.56 percent with an average 0.5 point for the week ending September 12, 2019, up from last week when it averaged 3.49 percent. A year ago at this time, the 30-year FRM averaged 4.6 percent.
  • 15-year fixed-rate mortgage averaged 3.09 percent with an average 0.5 point, up from last week when it averaged 3.0 percent. A year ago at this time, the 15-year FRM averaged 4.06 percent.

Source: Freddie Mac

Home Loan Rates Remain Low!

“Mortgage rates continued the summer swoon due to weaker economic data,” says Sam Khater, Freddie Mac’s chief economist. “While economic growth is clearly slowing due to rising manufacturing and trade headwinds, economic fundamentals are still solid for U.S. consumers. The unemployment rate is low, housing affordability is improving, home buyer demand is rising, and home price growth is stable.”

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

  • 30-year fixed-rate mortgages: averaged 3.49%, with an average 0.5 point, falling from last week’s 3.58% average. Last year at this time, they averaged 4.54%.
  • 15-year fixed-rate mortgages: averaged 3%, with an average 0.6 point, dropping from last week’s 3.06% average. A year ago, 15-year rates averaged 3.99%.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.30%, with an average 0.4 point, dropping from last week’s 3.31% average. A year ago, averaged 3.93%.
Source: Freddie Mac

Smartphones Are Guiding Buyers

Mobile devices are what buyers turn to for finding properties and real estate agents. This has put increasing importance on real estate pros to make sure their websites are mobile friendly and they’re connecting in a way that clients most desire.

The typical home buyer used a mobile device to search for properties online, looking at websites with photos, home listings, and information about the homebuying process, according to the newly released “Real Estate in a Digital Age 2019 Report” published by the National Association of REALTORS® that looks at technology use within transactions.

Overall, 76% of all buyers say they found their home on a mobile device. Seventeen percent of buyers surveyed said they also found their agent on a mobile device, too.

Source: “Real Estate in a Digital Age,” National Association of REALTORS® (8/2019)

Mortgage Rates at 2016 Territory

The 30-year fixed-rate mortgage averaged 3.55% this week, the lowest average since November 2016, Freddie Mac reports. The lower mortgage rates are boding well for the housing market.

“The drop in mortgage rates continues to stimulate the real estate market and the economy,” says Sam Khater, Freddie Mac’s chief economist. “Home purchase demand is up five percent from a year ago and has noticeably strengthened since the early summer months, while refinances surged to their highest share in three and a half years.”

Freddie Mac reports the following national averages for the week ending Aug. 22:

  • 30-year fixed-rate mortgages: averaged 3.55%, dropping from last week’s 3.60% average. Last year at this time, they averaged 4.51%.
  • 15-year fixed-rate mortgages: averaged 3.03%, with an average 0.5 point, falling from last week’s 3.07% average. A year ago, 15-year rates averaged 3.98%.
Source: Freddie Mac

Rates Hover Near Record Lows

“The sound and fury of the financial markets continue to warn of an impending recession; however, the silver lining is mortgage demand reached a three-year high this week,” says Sam Khater, Freddie Mac’s chief economist. “The decline in mortgage ratesover the last month is causing a spike in refinancing activity—as homeowners currently have $2 trillion in conventional mortgage loans that are in the money—which will help support consumer balance sheets and increase household cash flow. On top of that, purchase demand is up 7% from a year ago.”

Freddie Mac reports the following national averages for the week ending Aug. 15:

  • 30-year fixed-rate mortgages: averaged 3.60%, with an average 0.5 point, unchanged from last week’s average. Last year at this time, 30-year rates averaged 4.53%.
  • 15-year fixed-rate mortgages: averaged 3.07%, with an average 0.5 point, rising from last week’s 3.05% average. A year ago, 15-year rates averaged 4.01%.
Source: Freddie Mac

Latest Data Shows Housing Clash

Lower mortgage rates are prompting higher demand from home buyers to buy, but they aren’t finding enough homes for sale. Mortgage rates last week reached the lowest average since November 2016.

“July’s data highlight tension in the housing markets between buyers eager to take advantage of lower mortgage rates and potential sellers concerned about slowing price growth,” says George Ratiu, realtor.com®’s senior economist. “The decline in newly listed properties suggests that some would-be sellers are stepping back from the market, during the peak buying season, when most people are searching for their next home.”

July saw flat inventory growth, which realtor.com® researchers say could lead to inventory declines much sooner than originally anticipated. Newly listed properties were down 7% in July compared to a year ago, realtor.com® reports.

Source: realtor.com®

Mortage Rates Lowest Since 2016

“There is a tug of war in the financial markets between weaker business sentiment and consumer sentiment,” says Sam Khater, Freddie Mac’s chief economist. “Business sentiment is declining on negative trade and manufacturing headlines, but consumer sentiment remains buoyed by a strong labor market and low rates that will continue to drive home sales into the fall.”

Freddie Mac reports the following national averages for the week ending Aug. 8:

  • 30-year fixed-rate mortgages: averaged 3.60%, with an average 0.6 point, falling from last week’s 3.75% average. Last year at this time, 30-year rates averaged 4.59%.
  • 15-year fixed-rate mortgages: averaged 3.05%, with an average 0.5 point, falling from last week’s 3.20% average. A year ago, 15-year rates averaged 4.05%.
Source: Freddie Mac

If You Don’t Like Home Prices, Blame the Labor Shortage

A shortage of subcontractors continues to hit the new-home market, placing upward pressure on home prices, according to the latest reading from the National Association of Home Builders and Wells Fargo Housing Market Index. The index asked builders about specific shortages they’re facing among 15 different occupations.

The labor shortage over the past year has meant builders have had to pay higher wages to attract subcontractors and have faced greater difficulty in completing projects on time. Seventy-five percent of builders surveyed say the shortages have also translated into higher home prices.

Subcontractors index at article source: “Labor Shortages Still Hurting Affordability,” National Association of Home Builders’ Eye on Housing blog (Aug. 5, 2019)

Fed Just Cut Interest Rates

The Federal Reserve today cut interest rates for the first time since the Great Recession took hold in 2008. The Fed says its decision to lower interest rates a quarter-point , which comes after months of pressure from President Donald Trump, is designed to stave off the threat of an economic downturn.

Lower borrowing costs are helping buyers manage rising home prices. For example, buyers who spend $1,500 on monthly mortgage payments can afford to purchase a $402,500 home this year compared to $367,500 last year, when mortgage rates averaged 4.57%, according to realtor.com®. “Last year, buyers would have needed an additional $145 a month on top of the $1,500 to afford a $402,500 home,” says Danielle Hale, realtor.com®’s chief economist.

Source: “Realtor.com® Reports How Much More Home Buying Power There Is Today Thanks to Lower Mortgage Rates,” Forbes.com (July 30, 2019); “The Fed Just Cut Interest Rates. Here’s What That Means for You,” The New York Times (July 31, 2019); National Association of REALTORS®

Mortgage Rates at 3-Year Lows

After a slight uptick last week, mortgage rates fell back to a more regular pattern of hovering near three-year lows. Home buyers are responding to the lower rates, and mortgage applications for home purchases have continued to rise steadily the last two months to the highest year-over-year change since the fall of 2017, says Sam Khater, Freddie Mac’s chief economist.

Freddie Mac reported these national averages rates for the week ending July 25:

  • 30-year fixed-rate mortgages: averaged 3.75%, with an average 0.5 point, falling from last week’s 3.81% average. Last year at this time, rates averaged 4.54%.
  • 15-year fixed-rate mortgages: averaged 3.18%, with an average 0.5 point, falling from last week’s 3.23% average. A year ago, 15-year rates averaged 4.02%.
Source: Freddie Mac