Mortgage Rates PLUMMET! Is This Your Chance to Buy a Home?
Mortgage Rates Dip to Four-Month Low!
Good news for aspiring homeowners! The average rate on a 30-year U.S. mortgage has dropped to 6.63%, the lowest it's been since April, according to Freddie Mac. This offers a glimmer of hope for those who have been sidelined by high borrowing costs.
Last week, the rate was 6.72%, and a year ago, it averaged 6.47%. While the current rate is an improvement, it's important to remember that these rates are still higher than the pandemic lows that fueled a surge in home buying.
Rates on 15-year fixed-rate mortgages, often favored for refinancing, also saw a decrease, falling to 5.75% from 5.85% the previous week. A year ago, this rate was 5.63%.
What's Driving the Change?
Mortgage rates are influenced by a complex interplay of factors, including the Federal Reserve's monetary policy, the performance of the bond market, and overall economic expectations. The 10-year Treasury yield serves as a key benchmark for lenders when pricing home loans. Currently, the yield sits at 4.23%, a slight increase from Wednesday.
Elevated mortgage rates have contributed to a slowdown in the housing market since early 2022. Home sales experienced a significant drop last year, reaching their lowest point in nearly three decades.
Will This Trend Continue?
This marks the third consecutive week of declining rates. The current average is just slightly above the year's low of 6.62% set on April 10th. However, rates remain relatively close to the year's high of 7.04%, recorded in mid-January, which has contributed to sluggish home sales this year.
Whether this downward trend will persist remains to be seen. Keep an eye on economic indicators and Federal Reserve announcements for clues about the future direction of mortgage rates.