After the peak of one week in two years, fixed mortgage rates have been withdrawn this week.
According to the latest data published Thursday by Freddie Mac, the 30-year fixed-rate average fell to 4.85% with an average of 0.5 points. (Points are commissions paid to a lender equivalent to 1% of the loan amount.) It was 4.90% a week ago and 3.88% a year ago.
The 15-year fixed-rate average fell to 4.26% with an average value of 0.4 points. It was 4.29% a week ago and 3.19% a year ago. The average of the five-year adjustable rate increased by 4.10% with an average point of 0.3. It was 4.07 percent a week ago and 3.17 percent a year ago.
"Mortgage rates remained mostly stable this week, despite the turbulence in the stock market, which saw its third weekly decline following the financial crisis," said Aaron Terrazas, senior economist at Zillow. "For the most part, the bond markets have gone through this temporary volatility, which has not yet reached long-term interest rates, with rates remaining at the highest level since 2011 and showing few signs of withdrawal. weak, with higher expectations in the coming days, has so far not been able to weaken the rate hike rate ".
The Federal Reserve has published the minutes of the September meeting this week. Although the central bank does not set mortgage rates, its decisions influence them. In the minutes, the Fed reiterated its position that the best way to keep the economy strong is to continue to increase interest rates gradually. The Fed, which raised rates for the third time this year in September, reported that it would probably increase rates again in December and probably three times more in the next year.
Bankrate.com, which publishes a weekly mortgage rate trend index, found that nearly two-thirds of the surveyed experts say rates will remain relatively stable next week. Shashank Shekhar, CEO of Arcus Lending, is one who does not expect rates to move much.
"After rising to a maximum of seven years two weeks ago, mortgage rates remained mostly stable," said Shekhar. "The minutes of the Federal Open Market Committee (FOMC) meetings had no surprises: there are no other major economic events or announcements that could have a significant impact on rates, and after a sudden steep excursion at the end of September, the beginning of October, the markets should stop for about a week, put everything together and we could have only a quiet week in terms of mortgage rates ".
Nonetheless, rising rates have made ownership of a more expensive home. According to Realtor.com's calculations, the average monthly mortgage payment at the national level has increased by almost 16% or by $ 223 per month since last year. In the Washington region, monthly mortgage payments increased slightly more than 10%, to $ 2,291 from $ 2,077.
"Buyers can expect to get even farther out to land a house this fall," said Javier Vivas, director of economic research at Realtor.com. "However, the nature of this accessibility challenge is changing, tariffs are taking a more prominent role and price increases continue to slow down, and to be successful, buyers need to keep both sides of the eye in mind. equation and prepare for rates approaching 10-year levels. "
Meanwhile, higher rates have caused mortgage applications to collapse, according to the latest Mortgage Bankers Association data. The composite market index – a measure of the total volume of loan applications – decreased by 7.1 percent compared to a week before. The refinancing index fell 9 percent from the previous week, while the purchase index lost 6 percent.
Mortgage refinancing share accounted for 38.1 percent of all applications.
"The jump in rates in the last month has further decreased the volume of refinancing, but the demand for home buyers has held firm this fall," said Bob Broeksmit, president and CEO of MBA. "Even with rates almost a percentage point higher than a year ago, last week's purchase applications increased by 2.5% [year-over-year]".
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