Consumer Confidence Rises as Mortgage Rates Dip Below 7%
Just in time for the start of the Summer homebuying season, the positive news has hit the real estate market. Spring is looking bright for home buyers with these lowered borrowing costs. According to Freddie Mac’s data, the 30-year fixed-rate mortgage (FRM) has dipped to 6.94% as of May 23rd, which is an 8.08% decrease, from 7.02% making it the third straight week of declines. Just a year ago at this same time, the 30-year rate was averaging 6.57%.
The Fixed Rates (FRM) for 15-year mortgages have also declined, averaging 6.24% slightly down from last week at 6.28%. Just last year, the rate was at 5.97%. The current decline in mortgage rates and the encouraging reports of rising housing inventory are bright spots in the real estate market and serve as a confidence boost for individuals looking to buy or sell in the upcoming season.
Sam Khater, Freddie Mac’s chief economist, confirmed that, “Spring homebuyers received an unexpected windfall this week as mortgage rates dipped below the seven percent threshold for the first time in over a month.” This development is particularly exciting for those eager to re-enter the market as rates continue to decline.
Data for this month reveals a robust performance in the first quarter, providing further encouragement for prospective homebuyers. Lower mortgage rates have the potential to significantly reduce costs for borrowers, thereby expanding the range of purchasing options available to them. This surge in support for home shoppers navigating the housing market marks the most promising outlook since mid-April.
The Mortgage Bankers Association(MBA) also confirmed a surge in home loan applications, attributing it to the recent dip in mortgage rates, which decreased by 1.9% last week compared to the previous week. They anticipate this trend to persist, with rates expected to decline further throughout the summer. As mortgage rates continue to decrease, buyers and sellers eagerly anticipate rates dropping below 7%. With enhanced affordability and promising market conditions, consumer confidence is on the rise this season.
These rates dipping below the 7% threshold, makes this news a boon for Summer Homebuyers gearing up for their purchases in the upcoming season. They can look forward to a larger inventory in the housing market, enhanced stability, and a wider array of options to choose from this summer.
By BeachesMLS Staff
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Source: MSN, Realtor.com, The National Association of Realtors® and RISMedia
