{"id":4529,"date":"2023-08-31T18:40:59","date_gmt":"2023-08-31T18:40:59","guid":{"rendered":"https:\/\/frankbuysphilly.com\/mortgage-rates-drop-but-still-at-22-year-high\/"},"modified":"2023-08-31T18:40:59","modified_gmt":"2023-08-31T18:40:59","slug":"mortgage-rates-drop-but-still-at-22-year-high","status":"publish","type":"post","link":"https:\/\/frankbuysphilly.com\/mortgage-rates-drop-but-still-at-22-year-high\/","title":{"rendered":"Mortgage rates drop but still at 22-year high"},"content":{"rendered":"


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Mortgage rates<\/a> ticked down modestly after job openings data for July<\/a> came out yesterday, but rates remain elevated.\u00a0<\/p>\n

Freddie Mac\u2018s<\/a> Primary Mortgage Market Survey, which focuses on conventional and conforming loans with a 20% down payment, shows the 30-year fixed rate averaged 7.18% as of Aug. 31, down from last week<\/a>\u2019s 7.23%. By contrast, the 30-year fixed-rate mortgage was at 5.66% a year ago at this time.<\/p>\n

\u201cDespite continued high rates, low inventory is keeping house prices steady,\u201d said Sam Khater, Freddie Mac\u2019s chief economist. \u201cRecent volatility makes it difficult to forecast where rates will go next, but we should have a better gauge in September as the Federal Reserve determines their next steps regarding interest rate hikes.\u201d<\/p>\n

Other indices showed lower mortgage rates.<\/p>\n

HousingWire\u2019s Mortgage Rates Center<\/a> showed Optimal Blue\u2019s 30-year fixed rate for conventional loans at 7.07% on Wednesday, compared to 7.22% the previous week. At Mortgage News Daily<\/a> on Wednesday, the 30-year fixed rate for conventional loans was 7.06%, down from 7.36% the previous week.<\/p>\n

What to expect with the Fed ?<\/strong><\/h2>\n

At the last Federal Open Market Committee<\/a> meeting, Federal Reserve Chair Jerome Powell emphasized the importance of July\u2019s core Personal Consumption Expenditure (PCE) Price Index for the Fed’s future path. The results came in today and the PCE price index jumped slightly from year-ago levels but grew at a mild monthly rate, which is more in line with the Fed\u2019s 2% inflation target. <\/p>\n

Meanwhile, the labor market is cooling as U.S. job openings<\/a> dropped in July. However, more robust data points will be required to confidently assert that inflation is moving in the desired direction, said Realtor.com <\/strong>Economist Jiayi Xu.<\/strong><\/p>\n

\u201cDespite mortgage rates hitting 20-year highs, we still expect them to reverse course and trend lower as we gather more solid evidence of inflation improvements in the coming months,\u201d added Xu.<\/strong><\/p>\n

What does it mean for the housing market ?<\/strong><\/h2>\n

Incentivized by return-to-office demands, some buyers have adjusted to the higher mortgage rate environment and are moving forward with their home search, according to Realtor.com\u2019s 2023 Hottest Zip Codes<\/a> report. However, first-time homebuyers are facing greater challenges to make such adjustments.<\/p>\n

\u201cFortunately, new homes remain an option for many, as builders are continuing to add homes with a somewhat greater focus on affordable price points,\u201d said Xu.<\/p>\n

What to expect for the fall <\/strong>?<\/strong><\/h2>\n

Last fall when mortgage rates surged, homebuyers adjusted pretty quickly, noted Bright MLS Chief Economist \u00a0Lisa Sturtevant.\u00a0First, they held back a little, only to come roaring back to the market in 2023. However, this time could be different, she said.<\/p>\n

Rates above 7% are now coupled with home prices near record highs.<\/p>\n

\u201cThe desire for homeownership is still strong, but there are going to be more and more prospective buyers for whom the numbers simply don\u2019t pencil out anymore at 7%+ rates,\u201d added Sturtevant.<\/p>\n

That said, mortgage applications<\/a> rose last week in spite of the rates being at a 22-year high. However, economists expect applications will decline significantly in the weeks ahead, bringing a shift in the housing market. <\/p>\n

\u201cAs demand contracts, supply will still remain low, so the slower market will not necessarily translate into significant price declines,\u201d said Sturtevant.<\/p>\n


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Mortgage rates ticked down modestly after job openings data for July came out yesterday, but rates remain elevated.\u00a0 Freddie Mac\u2018s Primary Mortgage Market Survey, which focuses on conventional and conforming loans with a 20% down payment, shows the 30-year fixed rate averaged 7.18% as of Aug. 31, down from last week\u2019s 7.23%. By contrast, the […]<\/p>\n","protected":false},"author":2,"featured_media":4530,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33,1],"tags":[],"_links":{"self":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts\/4529"}],"collection":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/comments?post=4529"}],"version-history":[{"count":0,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/posts\/4529\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/media\/4530"}],"wp:attachment":[{"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/media?parent=4529"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/categories?post=4529"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/frankbuysphilly.com\/wp-json\/wp\/v2\/tags?post=4529"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}