News

Record-Low Mortgage Rates: A Promising Opportunity for Prospective Homeowners

1 Mins read

Mortgage rates have reached their lowest level since May 2023, providing a glimmer of hope for prospective homeowners. As of January 18th, the 30-year fixed-rate mortgage averaged 6.6%, according to data released by Freddie Mac.

This marks a 6 basis point decrease from the previous week and a significant drop from the 6.15% average rate a year ago. Similarly, the average rate on a 15-year mortgage has decreased to 5.76% from 5.87% last week and 5.28% compared to a year ago.

Freddie Mac’s weekly report on mortgage rates is based on thousands of applications received from lenders across the country. This data provides valuable insight into the state of the housing market, particularly for first-time homebuyers who are sensitive to changes in affordability.

Chief economist at Freddie Mac, Sam Khater, stated, “This is an encouraging development for the housing market and in particular first-time homebuyers who are sensitive to changes in housing affordability.”

However, as purchase demand increases, it will further strain the already depleted inventory for sale. While lower mortgage rates may lead to more transactions in the market, it does not mean that home prices will remain stagnant.

Lisa Sturtevant, chief economist at Bright MLS, explained, “On a loan to purchase a $400,000 home, a one percentage point decrease in mortgage rates can lead to a $250 drop in the typical monthly payment.” She added, “But we should not expect home prices to stay flat as mortgage rates decline. Lower rates in 2024 will lead to more transactions, encouraging both more buyers and sellers to enter the market. But it will continue to be a very competitive market for homebuyers in 2024.”

Overall, these record-low mortgage rates offer a promising opportunity for prospective homeowners, but they should be cautious as the market remains highly competitive.

Related posts
News

IMF commends Sri Lanka's new govt for reform continuation

1 Mins read
COLOMBO, Apr 25: The International Monetary Fund (IMF) on Friday commended the Sri Lankan government, led by President Anura Kumara Dissanayake, for…
News

U.S. Federal Reserve revokes crypto guidance for banks

1 Mins read
25th April 2025 – (Washington) The U.S. Federal Reserve announced on 24th April that it will withdraw previous guidance requiring state member…
News

Largo Reports Q1 2025 Production and Sales Results; Provides Update on Operational Turnaround Plans By Investing.com

7 Mins read
All dollar amounts expressed are in thousands of U.S. dollars unless otherwise indicated.Trending NowBest Forex Trading Robots To Invest In 2022 Q1…

Leave a Reply

Your email address will not be published. Required fields are marked *

37 − = 29