Mortgage Rates Rewind—Will Buyers Find Relief?
Mortgage rates rewound last week, with the average 30-year, fixed settling at 4.53 percent, down from 4.59 percent the prior week, according to Freddie Mac's latest Primary Mortgage Market Survey® (PMMS®). The downtrend is now in its second straight week—but is it enough to impact sales?
"This stability in borrowing costs comes despite the highest core inflation rates since 2008 and turbulence in the currency markets," says Sam Khater, chief economist at Freddie Mac. "Unfortunately, this pause in rates is not leading to increasing home sales."
On an annual basis, existing-home sales were 2.2 percent lower at the start of summer, according to the National Association of REALTORS® (NAR); likewise, new-home sales sunk 5.3 percent.
"Purchase mortgage applications trailed year-ago levels again last week, and it's clear that in some markets the combination of ascending home prices, limited affordable inventory and this year's higher rates are curtailing homebuyer demand," Khater says.