Freddie Mac: Mortgage rates drop as rate hikes may slow soon

In his latest report, Freddie Mac said mortgage rates have fallen, but economic uncertainty continues to dampen buyer demand. (iStock)

The average 30-year mortgage rate fell for the third week in a row this week, as markets are gaining confidence that interest rate increases will slow in 2023, according to a new report by Freddie Mac.

According to Freddie Mac’s Primary Mortgage Market Survey, the average 30-year fixed rate mortgage rate fell to 6.49% in the week ended December 1, 2022, from 6.58% the week before.

The average 15-year fixed rate mortgage averaged 5.76%, up from 5.9% the previous week.

“Mortgage rates continued to fall this week as optimism grew that the Fed would slow the rate of rate hikes,” Freddie Mac Chief Economist Sam Khater said in a statement. “Even though interest rates are falling and housing prices are softening, economic uncertainty continues to limit demand from home buyers as we enter the last month of the year,” he said.

According to the latest forecast by Bank of America, the USA may enter recession in the first quarter of 2023. The Mortgage Bankers Association (MBA) said that inflation may not reach the Fed’s 2% target rate until 2024, although inflation growth has waned.

The Consumer Price Index (CPI), a measure of inflation, rose 7.7% year-on-year in October, following an 8.2% increase in September. However, the rate is still close to the 40-year high of 9.1% earlier this year. With inflation continuing to hover above average, the Federal Reserve is likely to continue raising interest rates. can slow down.

If you want to take advantage of today’s interest rates before they potentially increase, consider refinancing your loan to lower your monthly payment. Visit Credible to find your personalized rate without affecting your credit score.

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House delistings hit record high

Amid high home prices, an average of 2% of homes for sale in the US were delisted in the 12 weeks ending November 20, compared to 1.6% last year, according to a new report from Redfin.

Real estate brokerage states that sellers pull their homes off the market because they often receive little or no offers for the price they are seeking. Redfin attributes this to rising mortgage rates and consistently high home prices.

“Some sellers have a hard time realizing that we’re no longer in a housing market frenzy – it’s hard for them to accept that they’re missing the boat when they charge a high price,” said Heather Kruayai, a Redfin real estate agent in Jacksonville. , FL said in the report. “When sellers realize that their listings are priced too high, it’s already been on the market for too long and is considered stale. I recently had two sellers pull their homes off the market after more than 45 days.”

If you’re struggling in the current economy, consider refinancing your mortgage at a lower rate to lower monthly payments. Visit Credible to speak with a refinancing specialist and see if this option is right for you.

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Housing price increases slow

According to CoreLogic, the pace of growth is starting to slow, despite the rising home price environment.

Year-over-year home price growth fell to 13.5% in August, marking the fourth consecutive month of annual growth, according to the latest CoreLogic Home Price Index. The firm expects annual US home price growth to slow over the next 12 months to reach 3.9% by September 2023.

Selma Hepp, interim head of CoreLogic’s chief economist office, said in a statement, “The rapid rise in prices during the COVID-19 pandemic has caused many US housing markets to reach levels that are completely unaffordable for potential local home buyers.” “In the West Coast and Mountain-West states, home prices are slowing from this spring’s high, but remain high from a year ago.

“In contrast, markets that continue to see internal migration of high-income households are still experiencing housing price increases that are significantly higher than the national appreciation rate,” Hepp said.

If you’re interested in taking advantage of lower mortgage rates, you may want to consider refinancing your home loan. Visit Credible to compare multiple mortgage lenders at once and choose the one that has the best option for you.

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