Good news on the home buying front. According to the Associated Press as quoted in an update from the Florida Realtor Association, U.S. long-term mortgage rates fell this week to a 10-month low1. The low rates should spur on home sales in the coming months. Freddie Mac places the average rate for 30 years, fixed-rate mortgages at 4.41% down from 4.46% last week. One year ago the 30-year rates averaged 4.32%. 15-year rates dropped from 3.89% to 3.84% this past week.
Home price increases in many areas of the U.S. have slowed and inventory has increased. In the Sarasota / Bradenton / Lakewood Ranch area, inventory levels are approaching 6 months of inventory on hand, up from 4 months for much of last year. The higher inventory levels and lower interest rates are poised to boost the spring buying season throughout the U.S.
“The U.S. economy remains on solid ground, inflation is contained and the threat of higher short-term rates is fading from view,” said Freddie Mac chief economist Sam Khater1.
The Fed has kept its benchmark interest steady last week which sends a strong signal that it does see a need to raise rates anytime soon. Wall street rallied in response to this message.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. The average fee on 30-year fixed-rate mortgages fell this week to 0.4 point from 0.5 point. The fee on 15-year mortgages held steady at 0.4 point. The average rate for five-year adjustable-rate mortgages dropped to 3.91 percent from 3.96 percent last week. The fee was unchanged at 0.3 point1.
- Mortgage rates hit 10-month low