Jenny and Dolly Lentz discuss home buying in today's market on The Claman Countdown.
Mortgage rates fell to their lowest level in a year and a half this week, but rising interest rates and soaring home prices are still keeping would-be homebuyers and sellers out of the housing market.
Freddie Mac's latest primary mortgage market survey released Thursday showed that the average benchmark interest rate was 30-year fixed rate mortgage That's down from 6.35% in the previous two weeks to 6.20%. The average rate on a 30-year mortgage was 7.18% a year ago.
A “For Sale” sign in front of a home in San Jose, California, on September 5, 2024. (David Paul Morris/Bloomberg via Getty Images/Getty Images)
“Mortgage rates have fallen more than half a percentage point over the past six weeks to their lowest levels since February 2023,” Freddie Mac chief economist Sam Carter said in a statement.
“Interest rates continue to soften on the back of more muted economic data,” Carter continued. “But despite the improving mortgage rate environment, prospective buyers negotiating the combination of rising home prices and continued supply shortages are still remaining on the sidelines.”
Many buyers and sellers are waiting to see if interest rates will fall further. Currently, about 80% of mortgage holders are living with less than 5% down, according to Zillow research.
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The average interest rate on a 15-year fixed mortgage fell to 5.27% from 5.47% last week. A year ago, the average interest rate on a 15-year fixed loan was 6.51%.
