The latest decline brought the average rate on a 30-year mortgage down to 7.29% from 7.44% last week, mortgage buyer Freddie Mac said Wednesday. A year ago, the rate averaged 6.58%.
Despite the recent pullback, the average rate on a 30-year home loan is still sharply higher than just two years ago, when it was around 3%. Higher rates can add hundreds of dollars a month in costs for borrowers, limiting how much they can afford in a market already out of reach for many Americans. They also discourage homeowners who locked in far lower rates two years ago from selling.
The elevated mortgage rates and a near-historic-low supply of homes on the market have kept a lid on sales of previously occupied U.S. homes, which slumped in October to their slowest pace in more than 13 years and have now fallen 20.2% through the first 10 months of the year versus the same period in 2022.
“In recent weeks, rates have dropped by half a percent, but potential home buyers continue to hold out for lower rates and more inventory,” said Sam Khater, Freddie Mac’s chief economist.
The Spanish capital has luxury, eclectic experiences, adventure – and it’s all within a half-hour of the city center.
The average rate on a 30-year home loan climbed above 6% in September 2022 and has remained above that threshold since. Just four weeks ago, it averaged 7.79% — the highest average on record going back to late 2000. The average rate is now at the lowest level it’s been in nine weeks, when it was 7.19%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their mortgage, also declined this week, with the average rate falling to 6.67% from 6.76% last week. A year ago, it averaged 5.9%, Freddie Mac said.
Rates have been declining in recent weeks along with the 10-year Treasury yield, which lenders use as a guide to pricing loans. The yield, which just a few weeks ago was above 5%, its highest level since 2007, has fallen amid hopes that inflation has cooled enough to pave the way for the Federal Reserve to cut rates.
The yield on the 10-year Treasury was at 4.42% in midday trading Wednesday, up from 4.40% late Tuesday.
Follow us at ACOM Capital
Follow us on social media
Welcome to Acom Capital, your gateway to tailored financing solutions for Investment Residential and Commercial Real Estate.
Copyright © 2024 Acom Capital. All Rights Reserved.
