Mortgage rates were the lowest since September

Mortgage rates fell sharply last week to the lowest level since mid-September, due to the positive market response to the latest inflation news, Freddie Mac reported.

Its Primary Market Survey for the week of January 19 found the average for the 30-year fixed-rate mortgage fell to 6.15%, a drop of 18 times. master from 6.33% last week. That was the lowest since the week of September 15, 2022, when it crossed back. above the 6% mark.

For the same period last yearthe 30-year FRM was 3.56%.

The 15-year FRM fell to 5.28%, down 24 basis points from last week’s 5.52% but still above last year’s 2.79%.

“Prices are at their lowest level since September of last year, increasing demand from home buyers and builders,” said Sam Khater, Freddie Mac chief economist, in a press release. “The reduction in prices is giving a big boost to the housing market, but the supply of housing remains a concern.”

The National Association of Home Builder/Wells Fargo Housing Market Index rose for the first time in January since December 2021.

However, the possibility of rising in Congress on the national debt ceiling could increase mortgage rates again, said a statement from Orphe Divounguy, senior macroeconomist at Zillow Home Loans, made the announcement Wednesday night.

“The closer we get to the brink, the higher the risk of default,” said Orphe Divounguy, senior macroeconomist at Zillow Home Loans, given last night. it’s Wednesday. “This could raise borrowing costs, including mortgages, and disrupt the already cold housing market.”

That’s what happened the last time such a dispute arose, back in 2011. America’s credit rating has plummeted for the first time,” said Divounguy. “A fight over raising the debt ceiling may drag on in the summer, and mortgage borrowers should expect fluctuating rates it’s a result.”

Zillow’s own survey had a 10-basis week-over-week decline in the 30-year FRM as of Thursday morning, at 5.78%.

So far, the information about the debt ceiling has had little effect on the 10-year Treasury yield, one of the indicators used to help the price of mortgages.

On January 11, the 10-year yield closed at 3.554%. It jumped again in the next few days, ending up 3.535% on January 17. But the next day, it fell to 3.375%. By midday eastern on Thursday, the rate was up just 2 basis points to 3.395%.

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