Mortgage Interest Rates Drop To The Lowest Rates Yet
As we end the first week of November, mortgage interest rates have once again fallen to a new record low. According to Freddie Mac, rates for a 30-year, fixed-rate mortgage closed out the week at 2.78% which is down from 2.81% the week before. This is the 12th time in 2020 that mortgage interest rates have reached their lowest point in the nearly fifty years Freddie Mac has administered the weekly survey.
Interest rates on a 15-year loan didn’t change over the past week, maintaining their position at 2.32%.
These low rates led to yet another push from the refinance market, with applications increasing 6% from the week prior or a full 88% higher than the same week last year, according to the Mortgage Bankers Association weekly report. Purchase applications saw a slight decrease, of only 1% on a seasonally adjusted basis, which is the fifth time in six weeks the number of applications have declined. This is the time of year when purchases tend to slow down, but there are also so few homes on the market in affordable price ranges that buyers have less to choose from. The number of homes on the market is 38% lower than a year ago and of homes that are o the market they are selling about two weeks more quickly than one year prior, per the latest data from Realtor.com.
“After a solid stretch of purchase applications growth, activity decreased for the fifth time in six weeks, but was still over 25 percent higher than a year ago, and has increased year-over-year for six straight months,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “2020 continues to overall be a strong year for the housing market.”
Sam Khater, Freddie Mac’s Chief Economist, agrees: “Despite the uncertainty that we’ve all experienced this year, the housing market, buoyed by low rates, continues to be a bright spot.”