Rates Cool For The First Time In Five Weeks

Average mortgage rates declined for the first time in five weeks following cooling employment, a sign of easing inflation. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 7.09%, down from the week prior’s 7.22%. A year ago at this time, the 30-year FRM averaged 6.35%. This is the first reversal after a multi-week upward streak that sent rates to their highest point since November 2023. Those weeks of increases pushed the median monthly housing payment to a new record high of $2,894 during the four weeks ending May 5, up 14% YOY. Recent government data found that the U.S. economy added 175,000 in April, below expectations of 240,000, while unemployment increased to 3.9%. This was good…

Mortgage Rates Move Up Just Barely

Mortgage rates were basically stagnant last week, staying put in the upper-6% range yet again. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.82%, up just slightly from the week prior’s 6.79%. A year ago at this time, the 30-year FRM averaged 6.28%. The 15-year fixed rate also fell from 6.11% to 6.06%. A year ago, it averaged 5.64%.  This week’s data reinforces that rates have stabilized in the 6%’s for the moment. “Since the start of 2024, the 30-year fixed-rate mortgage has not reached 7% but has not dropped below 6.6% either,” said Sam Khater, Freddie Mac’s Chief Economist. “While incoming economic signals indicate lower rates of inflation, we do not expect rates will decrease…

Zillow Names Buffalo Hottest City Of 2024

Buffalo, NY, is slated to be the hottest market of 2024 as affordable metros gain popularity among money-minded Americans. Cincinnati and Columbus took numbers two and three on Zillow’s Hottest Markets of 2024 list, driving home the importance of savings for homebuyers this year. The list is made up of relatively low-cost cities, primarily in the Midwest and South. Indianapolis, IN; Providence, RI; Atlanta, GA; Charlotte, NC (2023’s hottest city, now in 7th place); Cleveland, OH; Orlando, FL, and Tampa, FL, rounded out the top ten. Zillow’s analysis looks at the 50 most populous metros and measures local home value growth and the speed at which home sellers are entering contracts with buyers, as well as job growth per new…

Rates Fall For Fifth Week, Down To 7.22%

Mortgage rates slipped for a fifth consecutive week, spurring a boost in purchase activity. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 7.22%, down from the week prior’s 7.29%. A year ago at this time, the 30-year FRM averaged 6.49%. The 15-year fixed rate fell to 6.56%% from 6.67%. A year ago, it averaged 5.76%. “Market sentiment has significantly shifted over the last month, leading to a continued decline in mortgage rates. The current trajectory of rates is an encouraging development for potential homebuyers, with purchase application activity recently rising to the same level as mid-September when rates were similar to today’s levels,” said Sam Khater, Freddie Mac’s Chief Economist. Purchase applications increased by 5% last…

Will The Housing Market Recover In 2024? Probably Not.

As 2023 nears its end, with mortgage rates slowing to the mid-7%s but home prices at record highs, the question on housing analysts’ minds is: Will 2024 be any better? For the most part, experts see a mixed bag coming next year, predicting the beginning of a turnaround that won’t fully flower until 2025. Realtor.com’s 2024 Housing Forcast suggests mortgage rates will moderate and ultimately average 6.8%, hitting 6.5% at year-end, while home prices ease slightly by 1.7%. But the company also predicts worsening inventory shortages as homebuyers cling to their current homes to keep their sub-5% rates. Still, Danielle Hale, chief economist for Realtor.com, emphasizes the bright sides of softening unaffordability. “Our 2024 housing forecast reveals the green shoots…

Price Appreciation Cools To Single Digits

Home price growth cooled to the single digits for the first time in a year as both buyers and sellers continued to pull back from the market. The typical home cost $400,000, an annual increase of 8.4%, according to Realtor.com’s Monthly Housing Trends Report. While price appreciation remains elevated, it’s far lower now than its peak of 18% YOY earlier this year. The number of homes for sale was up 74.6% YOY, with 49 of the 50 largest metros seeing their inventory increase. That metric remained 38% lower than the December 2017-2019 average, however. Newly listed homes and pending listings both declined YOY.  Home sellers who are locked into low interest rates are hesitant to take on a more expensive…

Housing Starts Beat Expectations In August

Housing starts surprised the industry with a boost in August, though building permits lagged at their slowest pace the last two years. Starts increased 12.2% month-over-month to an annualized rate of 1.575 million units in August, exceeding market expectations of 1.445 million. This is the largest jump since March last year. But while the data may be positive, housing still faces pressure from inflated material costs and rising interest rates. Single-family starts increased by only 3.4%. The unexpected jump was propelled by a 28.6% surge in demand for buildings with five or more units, suggesting builders are betting on the hot rental market to stay. That prospect doesn’t bode well for the homebuilders. Builder sentiment dropped three points in September,…

Home Sales Fall Nearly 20% YOY

Buyers are still fleeing the market in droves despite signs of cooling, driven out by rising mortgage rates and economic uncertainty. Home sales fell by 19.3% YOY in July, hitting their lowest level since the pandemic started, Redfin reported. It’s the biggest annual decline in U.S. home sales in more than a year. Sales also fell 4.1% from June. Redfin noted that while affordability challenges pushed some buyers out, others were concerned about the potential for home-value declines. Home price appreciation rose at its slowest pace since June 2020, up only 7.7%, and talk of price correction is everywhere. Fewer homeowners put their homes on the market, too. New listings fell 13.5% YOY, the biggest decline in more than a…

Eight Of The Ten Most Expensive Metros For Rent Are In California And Florida

California and Florida metros collectively account for 80% of the top 10 highest average rents across the country, forcing Americans to look to the middle of the country for affordable rentals. That’s according to HouseCanary’s first National Rental Report, which compares listings volumes, new listings, and median listing price information on single-family detached listings from H1 2021 and H1 2022. National rent prices saw a double-digit increase, up 13.4% YOY in the first half of 2022. At the end of H1 2022, the average rent was $2,495. Property demand remained strong, with the number of days on the market staying basically the same from last year. At the end of H1, rentals were on the market for an average of…

Loan App Volume Dips To Lowest Level Since February 2000

Mortgage loan application volume fell by another 1.8%, the fourth straight week of declines and the lowest level of activity since February 2000, the Mortgage Bankers Association’s weekly survey shows. The adjusted Market Composite Index, a measure of mortgage loan application volume, decreased by 1.8%. The adjusted purchase index dropped 1%, while the unadjusted purchase index decreased by 0.4%% and was 18% lower YOY. The refinance index fell by 4% and made up 30.7% of total applications, down 83% from the same time last year.  ARM activity dropped to 9.1% of total applications.  As affordability challenges continue and potential buyers decide to hold off searching for a home, purchase activity is now inching closer to pre-pandemic levels. “Weakening purchase applications…