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Your weekly economic update is here! Here's what you need to know: Mortgage rates increased another six basis points according to the Freddie Mac Primary Mortgage Market Survey released January 2, 2025. As the 30 Year Fixed Rate Mortgage once again nears seven percent, this marks the third straight week of increases, and it is at its highest point in nearly six months. Compared to this time last year, rates are elevated, and the market’s affordability headwinds persist. However, buyers appear to be more inclined to get off the sidelines as pending home sales rise. Mortgage applications decreased 21.9 percent from two weeks earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 27, 2024. The results include an adjustment to account for the Christmas holiday. “Mortgage rates moved higher through the last full week of 2024, reaching almost 7 percent for 30-year fixed-rate loans,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Not surprisingly, the increase in rates, at a time when housing activity typically grinds to a halt, resulted in declines in both refinance and purchase applications.” Pending home sales gained 2.2% in November, the fourth consecutive month of increases and the highest level since February 2023, according to the National Association of REALTORS®. The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, advanced 2.2% to 79.0 in November. Year-over-year, pending transactions improved 6.9%. “Consumers appeared to have recalibrated expectations regarding mortgage rates and are taking advantage of more available inventory,” said NAR Chief Economist Lawrence Yun. “Mortgage rates have averaged above 6% for the past 24 months. Buyers are no longer waiting for or expecting mortgage rates to fall substantially. Furthermore, buyers are in a better position to negotiate as the market shifts away from a seller’s market.” U.S. home prices increased 0.3% on an adjusted basis in October compared with September and were up 3.6% compared with October 2023, according to the S&P CoreLogic Case-Shiller home price index. The report shows that home price growth is slowing. Month-over-month, the index’s 20-city composite and 10-city composites – measuring home prices in the top 20 largest U.S. metros – each decreased -0.3%, on an adjusted basis, indicating that home prices may have plateaued. In addition, October’s annual gain of 3.6% was a significant slowdown from September’s annual gain of 3.9%. “New York once again reigns supreme as the fastest-growing housing market with annual returns over double the national average,” says Brian D. Luke, CFA, head of commodities, real and digital assets, S&P Global, in a release. Stay ahead with the latest insights! hashtag #EconomicUpdate #StayInformed

Mortgage rates increased another six basis points according to the Freddie Mac Primary Mortgage Market Survey released January 2, 2025. As the 30 Year Fixed Rate Mortgage once again nears seven percent, this marks the third straight week of increases, and it is at its highest point in nearly six months. Compared to this time last year, rates are elevated, and the market’s affordability headwinds persist. However, buyers appear to be more inclined to get off the sidelines as pending home sales rise. Mortgage applications decreased 21.9 percent from two weeks earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 27, 2024. The results include an adjustment to account for the Christmas holiday. “Mortgage rates moved higher through the last full week of 2024, reaching almost 7 percent for 30-year fixed-rate loans,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Not surprisingly, the increase in rates, at a time when housing activity typically grinds to a halt, resulted in declines in both refinance and purchase applications.” Pending home sales gained 2.2% in November, the fourth consecutive month of increases and the highest level since February 2023, according to the National Association of REALTORS®. The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, advanced 2.2% to 79.0 in November. Year-over-year, pending transactions improved 6.9%. “Consumers appeared to have recalibrated expectations regarding mortgage rates and are taking advantage of more available inventory,” said NAR Chief Economist Lawrence Yun. “Mortgage rates have averaged above 6% for the past 24 months. Buyers are no longer waiting for or expecting mortgage rates to fall substantially. Furthermore, buyers are in a better position to negotiate as the market shifts away from a seller’s market.” U.S. home prices increased 0.3% on an adjusted basis in October compared with September and were up 3.6% compared with October 2023, according to the S&P CoreLogic Case-Shiller home price index. The report shows that home price growth is slowing. Month-over-month, the index’s 20-city composite and 10-city composites – measuring home prices in the top 20 largest U.S. metros – each decreased -0.3%, on an adjusted basis, indicating that home prices may have plateaued. In addition, October’s annual gain of 3.6% was a significant slowdown from September’s annual gain of 3.9%. “New York once again reigns supreme as the fastest-growing housing market with annual returns over double the national average,” says Brian D. Luke, CFA, head of commodities, real and digital assets, S&P Global, in a release Jeff Johnson NMLS 102315 Megastar Financial Corp 3043 https://lnkd.in/gcZkQqG 

Fannie Mae economists lower their expectations for 2024 home sales https://ift.tt/lbxoQps Mortgage rates have moved lower in recent months, but Fannie Mae economists said Wednesday that this won’t be enough to increase the number of homes sold in the foreseeable future. Fannie Mae’s Economic and Strategic Research (ESR) Group downgraded its forecasts for 2024 and 2025 home sales based on a number of reliable metrics that have “barely budged in response to the more favorable rate environment.“ These include purchase mortgage application levels, home tour requests and online views of listings. The ESR Group now expects 4.78 million home sales in 2024 (down from 4.81 million in its prior forecast) and 5.19 million sales in 2025 (down from 5.26 million). The estimates are also derived from Fannie’s most recent consumer survey in which only 17% of respondents said that it’s a “good time to buy a home.“ “On its face, the lower rate environment should be good for home sales by helping loosen the grip of the so-called ‘lock-in effect,’ in addition to aiding affordability more generally,“ Mark Palim, Fannie Mae vice president and deputy chief economist, said in a statement. “However, high-frequency data, such as mortgage applications, home showing requests, and listings views, suggest that many potential homebuyers remain reluctant to make the jump. Even with moderately lower mortgage rates, affordability remains close to historic lows due to the high level of home prices relative to incomes. We are therefore expecting continued sluggishness in home sales over the rest of the year.“ The ESR Group noted that demand for refinances has grown in response to lower mortgage rates, and this is expected to provide stability for origination volumes over the next 18 months. “Our projection for total mortgage originations in 2024 was essentially unchanged at $1.7 trillion, while our outlook for 2025 was revised upward slightly to $2.2 trillion, with an upgrade in refinance originations largely offsetting a downward revision to purchase originations,“ the economists explained. Source: Fannie Mae Fannie Mae calls for mortgage rates to average 6.4% by the end of this year and 5.9% by the end of next year. At HousingWire‘s Mortgage Rates Center on Wednesday, 30-year conventional loan rates averaged 6.68%. In a continuation of an ongoing trend, Fannie economists believe that new-home sales will continue to outperform existing-home sales “as strong builder margins are likely to drive concessions in the quarters ahead.“ But a backlog of homes under construction that have yet to sell should lead to a “near-term slowdown in starts … until this inventory can be sold.“ The ESR Group continues to forecast a “soft landing“ for the U.S. economy due to cooling inflation and the anticipation of a Federal Reserve rate cut. The group also mentioned the rising unemployment rate, which reached 4.3% in July, but believes that this increase is at least partially ...

Fannie Mae Revises Mortgage Rate Predictions for 2024 Mortgage rates moved higher this week, with the 30-year fixed-rate mortgage reaching a 6.87% average, Freddie Mac reports. Some economists are revising their rate predictions, looking for them to be higher this year than previously thought. Fannie Mae was among them, this week saying it expected the 30-year fixed-rate mortgage to end 2024 at 6.4%, up from its 5.9% prediction earlier this year. Economists say strong job numbers and hotter-than-expected inflation data are leading financial markets to forecast a less aggressive rate-cutting path by the Federal Reserve. The Fed this week kept its benchmark interest rate steady but continued to suggest that three rate cuts are coming. Nevertheless, Fannie Mae economists are predicting existing-home sales to trend upward this year. Its Home Purchase Sentiment Index recently showed 65% of homeowners say now is a “good time to sell,” a rising percentage. “The housing market is likely to continue to face the dual affordability constraints of high home prices and elevated interest rates in 2024,” says Doug Duncan, Fannie Mae’s chief economist. “Still, while we don’t expect a dramatic surge in the supply of homes for sale, we do anticipate an increase in the level of market transactions relative to 2023—even if mortgage rates remain elevated.” The National Association of REALTORS® reported Thursday that home sales in February were on the rise leading into the spring buying season. Existing-home sales jumped 10% in February, NAR reported. Though recent rate jumps could make some prospective home buyers jittery, not all are so sensitive to the week-to-week changes, says Lisa Sturtevant, chief economist at Bright MLS. “The number of cash buyers has increased. In many markets, these cash buyers are not investors but regular home buyers who have accrued significant equity in an existing home that they can roll over into the purchase of a new home.” Indeed, NAR’s latest housing report showed one-third of existing-home sales in February were cash deals. Given higher mortgage rates, Sturtevant predicts repeat buyers will make up a bigger share of the housing market in the months ahead. “First-time buyers will unfortunately have more buyers who they have to compete with as mortgage rates remain elevated,” she says. “The good news is that there should be more inventory coming into the market this spring.” Freddie Mac reports the national averages for mortgage rates for the week ending March 21: 30-year fixed-rate mortgages: averaged 6.87%, up from last week’s 6.74% average. Last year at this time, 30-year rates averaged 6.42%. 15-year fixed-rate mortgages: averaged 6.21%, rising from last week’s 6.16% average. A year ago, 15-year rates averaged 5.68%.

Economist: ‘Timing’ the Market May Not Work for Buyers... what do you think? Mortgage rates edged up this week, prompting a pause among some would-be house hunters. But here’s why they may not want to wait. Home shoppers are sensitive to mortgage rates, which was made clear this week with an increase in the average for the 30-year fixed-rate mortgage. The rate rose to 6.77%, and mortgage applications for home purchases fell 3%, according to the Mortgage Bankers Association. Every notch up and down in rates can impact home buyers’ purchasing power, but borrowing costs have largely stabilized. “While mortgage interest rates edged up weekly, the overall trajectory from fall 2023 is down and is now a full percentage point below the recent high” when rates neared 8%, says Jessica Lautz, deputy chief economist at the National Association of REALTORS®. “While mortgage interest rates may come down to the low 6% range in the middle to later part of the year, buyers must weigh what makes the most sense for them. Timing the real estate market based purely on mortgage interest rates—especially marginal changes—rarely works when new babies, marriages and jobs are the real decision-makers.” Buyers may not save much by waiting, either. Home buyers purchasing the typical home at $400,000, with a 20% down payment, would likely have a monthly mortgage payment of about $2,080 at this week’s rate average, Lautz says. Last week, when rates averaged 6.64%, home buyers could have paid about $70 less per month—but that was based on a median home price of $391,700. Home prices are rising quickly. The median price of an existing home surged to an all-time high in December, according to NAR, and prices are expected to continue to climb. The annual median home price is predicted to increase by 1.4% this year, and by another 2.6% in 2025, to $405,200, NAR’s forecast shows. Plus, housing inventory remains at historical lows and remain a major obstacle for would-be home buyers. That will keep pressure on home prices, economists say. Freddie Mac reports the following national averages for mortgage rates for the week ending Feb. 15: 30-year fixed-rate mortgages: averaged 6.77%, rising from last week’s 6.64% average. Last year at this time, 30-year rate averaged 6.32%. 15-year fixed-rate mortgages: averaged 6.12%, up from last week’s 5.90% average. A year ago, 15-year rates averaged 5.51%. https://lnkd.in/dkJ6jw5D #jimandlorihill #hillnhills #loveservecare #youhavefriendsintherealestatebusiness #changingpeoplelivesonehomeatatime #interestrates #buyingahome #wakeforest

Did lower mortgage rates lead to higher home prices in October? https://ift.tt/1XHARgv Home prices firmed up in today’s existing home sales report, but we caught on to this trend two months ago with our Housing Market Tracker. Traditionally, home prices soften in the second half of the year and I had counted on this for my price forecast, which predicted 2.33% home-price growth for 2024. However, that didn’t happen. The difference is mortgage rates: even with inventory growing at a healthy clip this year, mortgage rates just heading down toward 6% for a brief period of time resulted in higher prices in a seasonally soft period. From the National Association of Realtors: Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – expanded 3.4% from September to a seasonally adjusted annual rate of 3.96 million in October. Year-over-year, sales progressed 2.9% (up from 3.85 million in October 2023). The charts below show the key data lines from the NAR existing home sales report. Remember that we track housing data differently than the NAR, but these are the big four from their report. As part of our tracker, we focus on purchase application data, and I am always looking to see what level of mortgage rates gives us growth in purchase apps. When mortgage rates increased to 7.50% earlier in the year, purchase apps were very negative on the week-to-week data line. In fact, we had 14 negative weekly prints compared to two positive prints. However, once rates started to fall in June, this is what the next 18 weeks looked like: 12 positive prints  5 negative prints 1 flat print Since September after the Federal Reserve cut the Fed funds rate, mortgage rates have risen from 6% to 7%, but we saw good weekly growth in the data lines before that. Remember, purchase application data takes about 30-90 days to hit the existing home sales report. We can track demand faster with our weekly pending contract prints, so it shouldn’t have been a surprise that we had some growth in today’s report. I discussed this on Yahoo Finance this morning. Home prices As you can see below in our weekly tracker data, home prices were firming up in October, which really surprised me: I didn’t anticipate lower mortgage rates would have changed the data line so much. However, they did, and this is the second time over the past two years that mortgage rates just heading toward 6% changed housing market dynamics. This is something to think about for 2025. If you connect the dots with our weekly tracker data, it shouldn’t be surprising that housing demand picked up. We connect the economic data daily and weekly and don’t wait for monthly reports. Home prices firming up with higher inventory and mortgage rates just getting toward 6% is a lesson learned in 2024 for 2025.  via HousingWire https://ift.tt/cO3bACv November 21, 2024 at 02:39PM

📉 Mortgage Rates Ease Slightly as More Buyers Rush In News from NAR The average rate for the 30-year fixed-rate mortgage dialed back to 6.69% this week, falling from 6.81% the previous week, Freddie Mac reported Thursday. It marks the lowest average in more than a month, and the drop was enough to push up mortgage application activity, a gauge of homebuying activity. "The responsiveness of prospective home buyers to even small changes in rates illustrates that affordability headwinds persist" in the housing market, says Sam Khater, Freddie Mac's chief economist. Mortgage applications for home purchases jumped 6% in the latest week, the highest level since January, according to the Mortgage Bankers Association. The drop in mortgage rates, although modest, may be helping prospective buyers increase their purchasing power. "Rates in the mid-6s are more palatable than the near-7% of November," says Jessica Lautz, deputy chief economist at the National Association of REALTORS®. At this week's average, a monthly mortgage payment, assuming a 20% down payment, would be about $2,063 on a $400,000 home. With a 10% down payment, the monthly payment would average $2,321, Lautz says. The drop in rates also coincides with an uptick in housing inventory nationally, which may provide potential home buyers with "the chance in late fall to finally move off the sidelines," Lautz adds. Nationwide, housing inventory is up nearly 20% compared to a year ago, according to NAR data, which can be attributed to recent upticks in home sales. Existing-home sales in October were up nearly 3% compared to a year earlier-the first annual gain since July 2021. Pending home sales, a gauge measuring contract signings for home purchases, were up more than 5% in October compared to a year earlier, according to NAR. Still, "there is a long way to go before there is enough housing inventory for the pent-up demand in the housing market," Lautz says. "While there is a growth of existing homes, the inventory is still below February of 2020." Freddie Mac reports the following averages in mortgage rates for the week ending Dec. 5: • 30-year fixed-rate mortgages: averaged 6.69%, dropping from last week's 6.81% average. A year ago, 30-year rates averaged 7.03%. • 15-year fixed-rate mortgages: averaged 5.96%, also falling from last week when 15-year rates averaged 6.1%. Last year at this time, 15-year rates averaged 6.29%. #SouthFloridaHomes #MortgageRates #HomeBuyers #FloridaRealEstate #DreamHome #HouseHunting #RealEstateDeals #HomeSweetHome #BuyNow #InvestmentProperty #RealEstateMarket #FirstTimeHomeBuyer #LuxuryHomes #AffordableHousing

Are Home Buyers Getting Used to Higher Mortgage Rates?   The 30-year fixed-rate mortgage has hovered in the mid- to upper-6% range, even as the Federal Reserve this week makes another cut to its short-term interest rates. Home buyers seem to be getting over the shock of mortgage rates in the mid- to upper-6% range. The 30-year fixed-rate mortgage averaged 6.72% this week, Freddie Mac reports. Despite the Federal Reserve’s recent rate cuts, that average has held steady. Still, existing-home sales in November were up about 6% year over year, NAR reported Thursday. “Consumers may no longer be expecting the 3% to 4% mortgage rates from the COVID days,” Lawrence Yun, chief economist of the National Association of REALTORS®, said in a conference call Thursday announcing the latest uptick in existing-home sales. “With mortgage rates mostly stable … more homes available for sale … and job creation up, this is pushing home sales higher.” Sam Khater, Freddie Mac’s chief economist, points out that rates have stayed in the 6% to 7% range for the past 12 months. “Home buyers are slowly digesting these higher rates and are gradually willing to move forward with buying a home,” he says. “Consumers are getting used to the new normal,” Yun agrees, especially considering that the 50-year rate average is 7.7%. But What About the Fed Cutting Rates? The Federal Reserve voted on Wednesday to lower its short-term, benchmark interest rate by another quarter point, or 25 basis points—its third consecutive rate cut since September. The Fed also signaled that more rate cuts are likely in 2025. However, mortgage rates have largely refused to budge as the Fed has cut rates, Yun says. The Fed’s interest rate is not directly tied to mortgage rates, which mostly follow Treasury yields. NAR predicts that mortgage rates will average 6% for 2025, although Yun has said the trajectory of rates will greatly depend on inflation, the federal deficit and other economic pressures. Mortgage Rates This Week Freddie Mac reports the following national averages for mortgage rates for the week ending Dec. 19: 30-year fixed-rate mortgages: averaged 6.72%, rising from last week’s 6.60% average. A year ago, 30-year rates averaged 6.67%.  15-year fixed-rate mortgages: averaged 5.92%, increasing from last week’s 5.84% average. Last year at this time, 15-year rates averaged 5.95%. -2025 National Association of REALTORS

Mortgage Rates Ease ! Average mortgage rates have eased to below 7% for just the second time in eight weeks, according to Freddie Mac’s latest data. The 30-year, fixed-rate mortgage averaged 6.99% in the week ended June 6, down from 7.03% the previous week but up from the comparable week this time last year when it stood at 6.71%, the mortgage giant said Thursday. The 15-year, fixed-rate mortgage also decreased, averaging 6.29%. That’s lower than last week when it averaged 6.36% but higher than a year earlier when it was 6.07%. As of Wednesday afternoon, the current 30-year, fixed-rate mortgage stood at 7.03%, and the 15-year, fixed-rate mortgage was 6.55%, according to Mortgage News Daily. Lower mortgage rates are a product of "incoming data showing slower growth," Freddie Mac's Chief Economist Sam Khater said in a statement. Industry professionals largely expected the downshift in rates this week, citing improvement in the bond market, indications that the economy is slowing. An updated picture of the labor market is set to be delivered Friday with May’s jobs report. “Bonds continue to rally as a result of a string of data pointing to a weakening economy. Subdued jobs numbers (new jobs and job openings), weaker manufacturing data and last week’s PCE data have sent yields tumbling,” Melissa Cohn, regional vice president at William Raveis Mortgage, said in a survey from personal finance website Bankrate. “Mortgage rates have followed suit. The real estate market is cheering!” Looking Ahead While this week brought positive news for mortgage rates, the bigger picture is more of a mixed bag as rates have hovered at the 7% threshold since mid-April. For one, expectations for the rest of the year are shifting. A panel of analysts revised their mortgage rate expectations for the year higher after the second quarter, according to a Fannie Mae report published Thursday. Previously, the panel had estimated mortgage rates would settle around 5.9% by the end of 2024. Now, they think that figure will be closer to 6.6%. At the same time, the continued upward pressure on mortgage rates is driving prospective homebuyers out of the market — a trend that could be beneficial for landlords and developers who could see increased demand for rental properties. Mortgages secured by residential properties were down 6.8% in the first quarter compared to the previous quarter, hitting their lowest level since 2000 and marking the 11th quarter of declines in the past 12 quarters, according to real estate data firm ATTOM’s U.S. Residential Property Mortgage Origination Report released Thursday. Total residential lending was down 4.8% on a yearly basis and 69.3% compared to its high point in 2021, the report said. The declines came from “all major categories of residential lending,” including purchase-loan activity, refinance deals and home-equity credit lines.

Mortgage interest rates have decreased again this week, with growing anticipation of future rate cuts. 📉 The 30-year fixed-rate mortgage now averages 6.77%, a significant drop from last week's 6.89%, according to Freddie Mac. This is the lowest level since mid-March. The 15-year fixed-rate mortgage has also decreased, averaging 6.05% this week. 🏠 Both the 30-year and 15-year rates are now lower than they were a year ago, marking a new trend. Despite the consistent decline, home buying demand remains subdued. Sam Khater, Freddie Mac's chief economist, notes that buyers are cautious, waiting to see if rates will drop further before committing to a purchase. Home sales typically slow during the peak summer heat, but affordability continues to be a major hurdle, according to Lisa Sturtevant, chief economist at Bright MLS. "Mortgage rates are likely to decrease further over the coming months, which could bring more buyers and sellers into the market, creating a more balanced environment," she said. The recent drop in mortgage rates has helped ease some affordability concerns. Redfin data shows that the typical monthly payment for homebuyers was $2,722 for the four weeks ending July 14, $115 lower than the peak in April. Chen Zhao, head of economic research at Redfin, suggests that now might be an opportune time for potential buyers to act. "Mortgage rates have likely already factored in the expected September cuts, so significant further declines are unlikely. Buyers should consider making offers now before prices rise further and while inventory is available," Zhao said. Inventory levels are increasing but at a slower pace, according to Redfin. Active listings are up 18.4% year-over-year but have seen the smallest increase in three months. Despite these trends, many homebuyers are still hesitant. The Mortgage Bankers Association reported a 3% drop in the seasonally adjusted purchase index from a week earlier and a 14% decrease from a year ago. However, refinance applications did increase this week. The decline in mortgage rates is influenced by the 10-year Treasury yields remaining below 4.2%, reflecting a slowing economy and easing inflation. Recent economic data, including the June jobs report and core price index readings, suggest that the Federal Reserve might consider rate cuts. "This trend should help keep mortgage rates on a downward path," said Jiayi Xu, an economist for Realtor.com. The upcoming Federal Reserve meeting later this month will provide more clarity on future rate cuts. While a cut in July is unlikely, it may signal readiness for reductions starting in September and provide insights into future plans. #realestate #mortgage #mortgagerate #treasury #realtor #realtors #redfin #zillow #freddiemac