Mortgage rates shrunk slightly last week, giving borrowers a little breathing room as they inch towards 7%, Freddie Mac reported Thursday.
Freddie’s Primary Mortgage Market Survey found that the 30-year fixed-rate mortgage averaged 6.66%, down from 6.70% just last week.
A year ago at this time, the 30-year FRM averaged 2.99%.
“Mortgage rates decreased slightly this week due to ongoing economic uncertainty,” said Sam Khater, Freddie Mac’s Chief Economist.
“However, rates remain quite high compared to just one year ago, meaning housing continues to be more expensive for potential homebuyers.”
Mortgage loan application volume tumbled last week, falling to its slowest pace since 1997 as the looming 7% interest rate scared buyers off the market.
A recent survey found that 1 in 4 people have decided to put off buying a home indefinitely due to the cost.
Though prices are far higher than a year ago, homeownership is still more affordable now than at the peak of the 2006 housing boom, a point economists have noted to assuage fears of another crash.
“While the supply-demand imbalance in today’s housing market continues to fuel strong house price appreciation across the country, the dramatic increase in house-buying power relative to 2006 driven by lower mortgage rates and higher incomes has more than made up for it. In fact, in four cities homes are more than 50% more affordable today than at their prior [price] peak,” Mark Fleming, chief economist at First American, said.
Additional findings from Thursday’s report:
- 15-year fixed-rate mortgage averaged 5.90% with an average 1.0 point.
- A year ago at this time, the 15-year FRM averaged 2.28%.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 5.36%, with an average 0.3 point.
- A year ago at this time, the 5-year ARM averaged 2.52%.
Read More Articles:
Are you offering unique options for clients as the market normalizes? If so, let us know. Email Editor Kimberley Haas at [email protected]