Average mortgage rates dipped below 7% last week, giving buyers some breathing room as they navigate a high-priced housing market.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.94%, down from the week prior’s 7.02%. A year ago at this time, the 30-year FRM averaged 6.57%.
The 15-year also fell, down from last week’s 6.24% to 6.38%. A year ago at this time it was 5.97%.
“Spring homebuyers received an unexpected windfall this week, as mortgage rates fell below the 7% threshold for the first time in over a month,” said Sam Khater, Freddie Mac’s Chief Economist.
“Although this week’s data on previously owned home sales showed a decline, total inventory of both new and existing homes is up. Greater supply coupled with the recent downward trend in rates is an encouraging sign for the housing market.”
Existing sales fell by 1.9% in April, a surprise to analysts who had forecast an uptick.
The inventory of unsold existing homes increased a generous 9% from the month prior to 1.21 million, the equivalent of 3.5 months’ supply at the current monthly sales pace. Annually, it jumped 16.3%.
But most buyers aren’t yet ready to jump into a home purchase with prices at record highs and rates elevated. Many of the homeowners who are selling are doing so out of necessity, knowing they may take a loss.
“The homeowners listing right now are often doing so because they need to: One of my clients is selling because of a family emergency, and another couple is selling because they had a baby and simply don’t have enough room,” said Sam Brinton, a Utah Redfin agent.
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