A prospective buyer attends an open house at a home in San Francisco, California, on Saturday, Nov. 4, 2023. Mortgage rates in the US fell for the first time in eight weeks while sticking close to a two-decade high, though borrowing costs are up steeply since early September.
A prospective buyer attends an open house at a home in San Francisco, California, on Saturday, Nov. 4, 2023. Mortgage rates in the US fell for the first time in eight weeks while sticking close to a two-decade high, though borrowing costs are up steeply since early September.
Mortgage rates in the US fell after two weeks of increases, dropping to the lowest level in almost eight months.
The average for a 30-year, fixed loan was 6.6%, the lowest since May and down from 6.66% last week, Freddie Mac said in a statement Thursday.
The reversal offers some reassurance for would-be buyers looking for a way into a deal as the housing market gets ready to enter its busiest season. But shoppers are likely to encounter high prices and bidding wars, thanks to a persistent shortage of listings across the country.
This week’s decline in mortgage rates “is an encouraging development for the housing market and in particular first-time homebuyers who are sensitive to changes in housing affordability,” Sam Khater, Freddie Mac’s chief economist, said in the statement. “However, as purchase demand continues to thaw, it will put more pressure on already depleted inventory for sale.”
That pressure should ease if rates fall significantly enough to give a critical mass of current homeowners - most of them holding onto sub-4% mortgages - an incentive to sell and find a new place.
Mortgages may be volatile in the short term. While the Federal Reserve has signaled it expects to start cutting interest rates this year, traders recently have tempered their bets on how soon that might happen. Benchmark Treasury yields jumped this week after a series of strong economic reports.
