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☆ Mortgage rates drop to lowest level since May
▼ + stars: | 2024-01-18 | by ( Anna Bahney | ) edition.cnn.com time to read: +2 min

Washington, DC CNN —After moving higher the past two weeks, mortgage rates fell this week, dropping to the their lowest level since May 2023. Mortgage rates remain more than a full percentage point lower than their highest levels of last year: 7.79%. However, he added, as more buyers come in off the sidelines attracted by lower rates, more pressure will be placed on already depleted inventory for sale. “In some markets, however, prices will rise much faster this year.”Still, lower rates can improve affordability by reducing the costs of financing a home. “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,” Sturtevant said.

Persons: Freddie Mac, who’ve, ”, Sam Khater, Freddie Mac’s, Lisa Sturtevant, Sturtevant, ” Sturtevant Organizations: DC CNN, “, homebuyers Locations: Washington, DC

New home sales fell 5.6% in October, worse than expected, as higher mortgage rates took a bite out of demand. The annual level of sales in October was 679,000, down from September’s substantially revised 719,000 pace, However, sales in October were still up 17.7% from a year ago. October saw a sharp increase in mortgage rates to around 8% for a 30-year fixed rate loan. However, the higher mortgage rates have slowed sales of new homes as well. The recent drop in mortgage rates, with more expected next year, could prove to be a tonic to the market.

Persons: ”, Kelly Mangold, Greg Logan, Lisa Sturtevant, ” “, ” Sturtevant Organizations: Census Bureau, Department of Housing, Urban Development, Builders, RCLCO Real Estate Consulting, MLS Locations: RCLCO, Southern, Northeast, Midwest

☆ Mortgage rates fall for third straight week, bringing some homeseekers off the sidelines
▼ + stars: | 2023-11-16 | by ( Anna Bahney | ) edition.cnn.com time to read: +5 min

Mortgage rates have cooled in recent weeks as markets absorbed the latest economic indicators, including an improving inflation picture. “For the third straight week, mortgage rates trended down, as new data indicates that inflationary pressures are receding,” said Sam Khater, Freddie Mac’s chief economist. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. “The gap between the 10-year Treasury yield and the 30-year fixed rate mortgage rate is historically around 180 basis points,” she said. “While the gap has narrowed somewhat, the 30-year mortgage rate remains 280 basis points higher than the bond yield.”By historical norms, she said, mortgage rates should be under 6.5%.

Persons: Freddie Mac, ”, Sam Khater, Freddie Mac’s, Price, Jiayi Xu, Jerome, Powell, ” Xu, Bob Broeksmit, Lawrence Yun, ” Yun, “, Lisa Sturtevant, ” Sturtevant Organizations: DC CNN —, Mortgage, Association, Federal Reserve, Treasury, Consumer, “, National Association of Realtors, Bright MLS Locations: Washington

☆ After this week’s Fed rate hike, where are mortgage rates headed?
▼ + stars: | 2022-12-16 | by ( Anna Bahney | ) edition.cnn.com time to read: +8 min

Mortgage rates have run up so far and so fast this year that many would-be homebuyers can no longer afford to buy a home. By fall, mortgage rates had more than doubled, eventually topping 7% in October. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. “We have to remember mortgage rates come down much slower than they go up,” said Cohn. “Volatility increases the level of mortgage rates, compared to Treasury rates, because of the prepayment option,” said Chester Spatt, professor of finance at Carnegie Mellon University’s Tepper School of Business.

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