30-Year Fixed Mortgage Rates Lowest in 28 Months
WASHINGTON -- Freddie Mac said 30-year home fixed-rate mortgages averaged 5.87% in the latest week -- the lowest since September 2005. A week ago the average was 6.07%, and in the year-earlier period it was 6.21%. From the most recent peak of 6.73% in mid-July 2007, 30-year rates have fallen almost a full percentage point (see chart above).
Will falling mortgage rates help the real estate industry turn around? Well, they sure can't hurt, and have to be a lot better for the real estate industry than rising rates! Example: payments on a $100,000 30-year mortgage at last July's rate of 6.73% ($647.27 per month) are almost 9.5% higher than payments at today's rate of 5.87% ($591.22 per month), suggesting at least some modest increase in affordability for home buyers.
4 Comments:
This is an average; could it be that lenders have simply stopped making risky and thus high rate mortgages? The test would be to check that the volumes have not fallen.
This would be great if I could buy a house for less than 500k in my area. I sure hope prices and interest rates drop much more! Of course, prices previously went up when rates went down, so we will see. More fed rate cuts to come . . .
when is the conforming loan limit going to increase?
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