Mortgage interest rates slipped again last week, marking the fourth consecutive week of decline, Freddie Mac reported Thursday.
Freddie’s Primary Mortgage Market Survey found that the 30-year fixed-rate mortgage averaged 6.33%, down from 6.49% the week prior.
A year ago at this time, the 30-year FRM averaged 3.10 percent.
The 15-year fixed-rate mortgage fell from 5.76% to 5.67%. A year ago, it averaged 2.38%.
“Over the last four weeks, mortgage rates have declined three-quarters of a point, the largest decline since 2008,” said Sam Khater, Freddie Mac’s Chief Economist. “While the decline in rates has been large, homebuyer sentiment remains low with no major positive reaction in purchase demand to these lower rates.”
Fannie Mae’s Home Purchase Sentiment Index broke its months-long downward streak recently, but sentiment rose just above its lowest reading on record. Buyers said they expect rates to keep climbing and home prices to sink.
Matthew Speakman, Zillow Home Loans senior economist, noted that the dip is tied to Federal Reserve Chairman Jerome Powell’s hint that the Fed may slow the pace of rate hikes this month.
“The inflation dynamic remains investors’ chief focus; mortgage rates barely budged in response to the monthly jobs report, a release that usually tends to move markets,” he wrote.
Nadia Evangelou, senior economist and director of real estate research at the National Association of Realtors, said that if rates stabilize near 6% by year-end, buying a home will become more affordable for many Americans.
“While the typical family cannot currently afford to buy a median-priced home as the qualifying income exceeds earned income, housing will become affordable again for Americans if rates hover near 6%,” she wrote.
“In this scenario, the typical family will earn about $1,000 more than the income needed to purchase a mid-priced home. With more buyers back in the market, the housing market may turn around at the beginning of the new year.”
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