As winter approaches, temperatures are dropping – and so are mortgage rates. But even with that cold effect, it remains more than double the previous year.
And this has caused buyers and sellers to hesitate before pulling the trigger on action.
“Today’s mortgage rates are keeping home buyers and sellers in a defensive position,” said George Ratiu, manager of economic research at Realtor.com.
Ratiu said that the monthly mortgage payment for a home based on the value of the home is $2,000 – a 64% jump from last year.
“First-time home buyers are struggling with high consumer prices, property prices and interest rates, which are pushing savings rates to record lows and lows.” giving them the ability to collect a minimum wage,” he said.
“At the same time, homeowners looking for their next home are seeing the expectation of higher prices and, in many cases, double or triple their existing interest rates. now, it has caused them to reconsider their decision to move.”
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30 year fixed rate mortgage
The average 30-year fixed-rate of 6.27%, slightly reduced from last week when the rate was 6.31%, Freddie Mac reported Thursday.
At this time last year, the 30-year home loan was only 3.05%.
“Prices have fallen significantly in the last six weeks, which is a big help for home buyers, but the latest data shows that homeowners are reluctant to list their homes,” said Sam Khater, Freddie Mac’s chief economist.
“Many homeowners are weighing their options carefully as more than two-thirds of current homeowners have the fixed mortgage rate below 4%.”
15 year fixed rate mortgage
The average 15-year fixed rate actually increased to 5.69%, compared to last week’s 5.54%. Last year, the rate was 2.30%.
Existing home sales fell 37% in November from January’s highs, “as buyers faced an insurmountable barrage of high home prices and rising interest rates,” written ratio.
“It was an unseasonably warm November in large parts of the country, with mortgage rates falling from a high of 7.08% at the start of the month to around 6.6% at the end, may have offered a fee to home buyers looking for the right opportunity. “
“However, even if the list prices continue from the highs of the summer, affordability remained a central challenge for November buyers,” he said.
Consumer confidence is on the rise – but Americans still can’t afford it
Americans are now more confident in the economy, thanks to a slowing economy and a positive jobs report in November, according to the latest data from the Conference Board, a business that is not some profits to think about.
The group’s survey showed that consumer confidence in the United States fell to an eight-month high in December, while demand for major purchases such as homes fell.
“Holiday prospects have improved, but plans to buy houses and big ticket machines have become softer,” said Lynn Franco, senior director of economic indicators at the Board of Directors.
“This shift in consumer preferences from big-ticket items to services will continue into 2023, as well as unexpected impacts from inflation and rising interest rates.”
Mortgage applications rise for second week
Mortgage applications rose 0.9% from last week, according to the Mortgage Bankers Association (MBA).
“This is a very slow time of year for home buying, so it’s no surprise that buying requests haven’t seen much activity in response to the low prices. mortgage,” said Mike Fratantoni, senior vice president and chief economist at MBA.
However, refinancing activity rose 6% as homeowners sought savings on their monthly payments along with lower rates. mortgage.
“Recent data on the housing market shows that home builders are slowing the pace of new construction in response to low traffic, and we expect this weakness in demand. will continue in 2023, because the US may enter a recession,” said Fratantoni.
“However, if mortgage rates continue to fall, as we have seen, many buyers may return to the market later in the year, due to the affordability to improve with lower prices and slower home price growth.”
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