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The 30-year fixed-rate loan was an average of 5.30% in the week ending July 7, down from 5.70% a week ago, according to Fredy Mack. This is 2.90 percent higher than last year.
Rates rose sharply at the beginning of the year, up 5.81% in mid-June. But since then, economic risks have dropped. The fall of the 40-point mark has offset some significant increases in May and June.
“Over the past two weeks, 30-year fixed-rate mortgages have fallen by half a year,” said Sam Cather, chief economist at Freddy Mack.
But buying a home is still a challenge. According to Joel Burner, a senior economist at Realtor.com, mortgages have been at an all-time high since the late 2000s, with list prices rising more than 8.5 percent year-over-year for 24 consecutive months.
If there is a silver lining for home buyers, many houses are hitting the market, he said. Active listings in June added the biggest annual growth in Realtor.com data history.
“With so many homes on the market, sellers are being forced to compete,” he said. “Despite the high cost of housing financing in recent years, buyers will still have a chance to get affordable housing when the incomplete and overheated housing market begins to slow down.”
Higher prices are reducing demand among buyers. Mortgage Applications In the week ending July 1, they fell 5.4% a week ago, according to the Credit Unions Association.
“The rate is still significantly higher than a year ago, which is why home purchases and financial applications remain a concern,” said Joel Khan, vice president of MBA Economic and Industrial Forecasting. “Subsequent challenges with affordable prices and low-cost purchases have hampered, and homeowners are still reluctant to apply for re-financing.”
Buyers are finding it increasingly difficult to buy a home because inflation is taking a large part of their income and reducing their ability to buy.
A year ago, the buyer paid $ 390,000 at an average price of $ 390,000 and paid the rest on a 30-year fixed-rate mortgage, with an average of 2.90%, and the monthly mortgage payment was $ 1,299. Freddie Mac.
Today, a homeowner who buys a home with an average price of 5.30% pays $ 1,733 a month in capital and interest. This is an additional $ 434 per month.
Mortgage prices fell this week, falling more than 3 percent in June in the first week of July, following a volatility in 10-year treasury production, down 2.8 percent.
Although the Federal Reserve does not set interest rates on mortgage loans, its actions will have an impact. Mortgage rates tend to track 10-year U.S. treasury bonds. When investors see or anticipate a tariff increase, they often sell government bonds, which results in higher yields and lower mortgage rates.
In addition, fears that we are entering the bear market have led investors to enter a long-term bond, Berner said.
This reversal can seem very dangerous, especially in the face of long-term inflation, as both markets and the federation may agree to a more balanced amount of money, but it remains to be seen whether these market conditions will lead to an increase in unemployment. Or the declining productivity index is declining, ”he said.
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