Mortgage Interest Rates Drop Again
Good Monday Morning!
Just when we thought the super low mortgage interest rates had left us behind, the rates decided to take another drop. It is a pleasant suprise, but don't get too excited about these super low rates hanging in there for the long haul. If you are sitting on the fence about a home purchase or a refinance, it might be wise to act quickly. The following is and update on the current mortgage rate market from "Realtor.com".
Mortgage rates retreated below 3% this week, but the factors that pushed them higher in previous weeks remains—all while Americans grow increasingly frustrated with the competitive housing market.
The 30-year fixed-rate mortgage averaged 2.99% for the week ending Oct. 7, down two basis points from the previous week, Freddie Mac reported Thursday. Last year, this mortgage product carried an average interest rate of 2.87%.
The 15-year fixed-rate mortgage fell five basis points to an average of 2.23%, while the 5-year Treasury-indexed hybrid adjustable-rate mortgage rose by four basis point to an average of 2.52%.
“Mortgage rates continue to hover at around 3% again this week due to rising economic and financial market uncertainties,” Sam Khater, Freddie Mac’s chief economist, said in the report. “Unfortunately, with the expectation that both mortgage rates and home prices will continue to rise, competition remains high and housing affordability is declining.”
All that competition continues to weigh on consumers, causing them to sour on the housing market. The results of a new survey from Fannie Mae released Thursday showed that roughly two-thirds of consumers believe now is a bad time to buy a home, and most people think it’s a good time to sell. Over half of the survey takers said that home prices will either go up or stay the same over the next 12 months.
“In our view, other housing market fundamentals remain supportive of further home price appreciation—including low levels of inventory and low interest rate,” Doug Duncan, chief economist at Fannie Mae, said in the report.
The Fannie Mae survey also showed, though, that a growing number of people are likely in for a bad surprise when it comes to mortgage rates. The share of people who expect interest rates to drop over the next year went up slightly from 6% to 8%, but most economists expect rates to increase over that time frame.
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