2/16/2024 0 Comments Drop Icons instaling![]() ![]() “The disparity between today’s higher market mortgage rates and the lower rates that existing homeowners benefit from on their current mortgages, commonly referred to as the lock-in effect, is expected to play a role in maintaining low inventory levels,” said Xu. This reluctance will keep inventory low, said Jiayi Xu, an economist at, in a statement, and buoy prices higher in the new year. That means that even if rates come down to the mid-6% levels, motivating homeowners with ultra-low mortgage rates to sell will still be difficult. Nearly two-thirds of current mortgage holders carry an interest rate of 4% or lower, and more than 90% have rates 6% or lower, according to ICE Mortgage Technology, a mortgage data company. “But in this very unusual market, where inventory has been locked down, it is more important to watch how falling rates influence prospective sellers’ decisions.” “We often talk about how lower mortgage rates will bring more buyers into the market,” Sturtevant said in a statement. Homebuyers have been acting opportunistically, jumping on rates when they dip and making offers during this period between Thanksgiving and New Year’s, which is typically when the housing market slows to a crawl, said Lisa Sturtevant, Bright MLS’s chief economist.īut, even as rates dip heading into the new year, the market won’t heat up too fast due to stubbornly low inventory, she said. Manhattan rents post first annual drop in over 2 years (Photo by Joe Raedle/Getty Images) Joe Raedle/Getty Images But the cost of shelter remains high, pushing the entire index up 0.1% between October and November. According to AAA, the national average for unleaded gas was $3.14 a gallon on December 12, which helped slow the growth of the Consumer Price Index. MIAMI, FLORIDA - DECEMBER 12: A "for rent" sign is posted in front of a home on Decemin Miami, Florida. “Lower mortgage rates are especially welcoming for prospective first-time buyers, who are still struggling to find available homes in their price range,” he said in a statement. Mortgage applications for the week ending December 8 increased from the week prior for the sixth consecutive week, according to the Mortgage Bankers Association.īob Broeksmit, MBA’s CEO, said the increase was a strong indication that borrower demand is rising as a result of the recent decline in mortgage rates. That’s welcome news for would-be buyers who have been facing the least affordable market since the 1980s. Recent weeks of declining rates indicate the highest mortgage rates of this cycle may have passed. The average rate rose above 7% in mid-August and reached as high as 7.79% at the end of October. “Given inflation continues to decelerate and the Federal Reserve Board’s current expectations that they will lower the federal funds target rate next year, we likely will see a gradual thawing of the housing market in the new year,” Khater said. “Potential homebuyers received welcome news this week as mortgage rates dropped below 7% for the first time since August,” Sam Khater, Freddie Mac’s chief economist said in a statement. The survey includes only borrowers who put 20% down and have excellent credit. The average mortgage rate is based on mortgage applications that Freddie Mac receives from thousands of lenders across the country. A year ago, the average 30-year fixed-rate was 6.31%. The 30-year fixed-rate mortgage rate fell to an average of 6.95% in the week ending December 14, down from 7.03% a week before, according to data from Freddie Mac released Thursday. This is the least affordable housing market since 1984. Homes in Centreville, Maryland, US, on Tuesday, April 4, 2023.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |