Mortgage rates remain temptingly low as buyers compete for homes

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Many potential home buyers would like to take advantage of the low mortgage rates, but the competition is fierce. For homeowners, the continuing low rates make refinancing a worthwhile option to consider.

Mortgage rates continue to hover near historic lows, which is an incentive for potential home buyers and homeowners to benefit from refinancing. Freddie Mac’s latest mortgage market research showed little change in average rates over the past week, with rates on 30-year fixed-rate mortgages staying just below 3 percent.

Sam Hater | Photo: Freddie Mac

“Home prices continue to rise while inventories remain low and new home construction cannot happen fast enough,” said Freddie Mac chief economist Sam Hather. statement… “There are many potential home buyers who would like to take advantage of low mortgage rates, but competition is fierce. For homeowners, however, continued low rates make refinancing a worthwhile option. ”

House prices in April rose 13 percent over last year. CoreLogic data show, creating a challenging environment for first-time home buyers, although Redfin analysis shows that sales of luxury homes this spring are up 26 percent year on year. BUT separate survey Data released this week by the Mortgage Bankers’ Association showed that demand for mortgages fell in the last week of May to levels not seen before the pandemic.

Freddie Mac’s Weekly Primary Mortgage Lending Survey found that during the week ending June 3:

  • Betting on 30 year fixed rate mortgage averaged 2.99 percent with an average of 0.6 points, up from 2.95 percent last week but down from 3.18 percent a year ago. IN record low For a 30-year fixed-rate mortgage, Freddie Mac’s 1971 records had the week ending January 7, 2021, when rates averaged 2.65 percent.
  • For Mortgage with a fixed interest rate for 15 years, rates averaged 2.27 percent with an average of 0.6 points, unchanged from last week and declining from 2.62 percent a year ago. The historic low for 15-year fixed-rate mortgages in records dating back to 1991 was also observed during the week ending January 7, 2021, when rates averaged 2.16 percent.
  • Betting on 5-Year Adjustable Rate Hybrid Mortgages (ARM) Treasury Indexed an average of 2.64 percent with an average of 0.2 points, up from 2.59 percent last week but down from 3.10 percent a year ago. ARM’s 5-year loan rates hit a record low of 2.56 percent for the week ending May 2, 2013, according to 2005 Freddie Mac records.

Source: Freddie Mac Initial research of the mortgage market

Freddie Mac’s research is based on conventional, eligible, fully amortized home loans for borrowers who have invested 20 percent and have excellent credit standing. Borrowers with less perfect credit or with lower down payments can look forward to higher rates.

Mortgage rates rose in February and March on fears that the Federal Reserve would be forced to take action to counter inflation. Although rates declined in April and stabilized in May, investors watching closely to see if the Fed will start discussions on when to cut the $ 40 billion in monthly mortgage bond purchases that helped keep rates low.

Credit stays denser than before the pandemic, for both homebuyers and homeowners looking to refinance, according to ICE Mortgage Technology’s latest origins report, which shows average FICO scores on closed loans increased by nearly 20 points in the past year.

Email Matt Carter



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