Fixed 30-year mortgage rates drop below 3% for the first time amid rising COVID-19 cases

The 30-year home mortgage fixed interest rate has dropped below 3 percent for the first time, Freddy Mac reported Thursday, adding that the historic decline has led to an increase in demand from homebuyers. housing during the coronavirus outbreak.

A weekly report from the federal government’s mortgage investor showed that 30-year fixed mortgage interest rates fell to 2.98 percent for the first time since record keeping began in 1971.

“The decline has led to increased demand from home buyers and these low rates have been capitalized on asset prices in support of financial markets,” the report says.

Housing construction is considered a critical component to an economic rebound after the coronavirus outbreak.

The chart above from a report released by Freddy Mac on Thursday shows that the 30-year home mortgage fixed interest rate has dropped below 3 percent for the first time

However, Freddy Mac also said that a “countervailing force for the economy” is increasing COVID-19 cases that continue to “stall” the recovery of the US economy from the pandemic.

“This economic pause puts many temporary layoffs at risk of becoming permanent job losses,” Freddy Mac warned in his report.

The latest Freddy Mac report also shows that the 15-year fixed mortgage rate fell to 2.48 percent.

Meanwhile, 5-year adjustable rate hybrid mortgages jumped at a rate of 3.06 percent, compared to 3.02 percent a week ago.

Freddy Mac also said that a “countervailing force for the economy” is increasing COVID-19 cases that continue to “stall” the recovery of the US economy from the pandemic. Frontline healthcare workers show up for test for COVID-19 in Homestead, Florida

Hundreds of people line up for unemployment benefits in Frankfort, Kentucky. Freddy Mac warned that the ‘economic pause’ caused by COVID-19 ‘puts many temporary layoffs at risk of ossifying in permanent job loss’

The reduced costs of mortgage rates are the result of the United States Federal Reserve reducing interest rates to almost zero to prop up the economy amid the devastating financial impacts of the virus.

The mandatory COVID-19 locks forced companies to permanently close or declare bankruptcy and have led to record unemployment.

So far, there have been 3,536,658 confirmed cases in the United States of the coronavirus, which has been attributed to 138,040 nationwide.

In a statement released in mid-March, the central bank said it was reducing rates to a target range of 0% to 0.25 percent.

At the time, it was the second interest rate cut in less than two weeks, as part of an emergency move by central bankers to address the impacts of the pandemic.

‘The effects of the coronavirus will weigh on economic activity in the short term and pose risks to the economic outlook. In light of these developments, the committee decided to lower the target range, ” the Fed said in a statement.

The reduced costs of mortgage rates are the result of the United States Federal Reserve reducing interest rates to almost zero to prop up the economy amid the devastating financial impacts of the virus. Pictured is Federal Reserve Chairman Jerome H. Powell on Capitol Hill.

Meanwhile, another 1.3 million Americans filed new claims for unemployment benefits last week, bringing the total number of people laid off from work during the pandemic to nearly 50 million.

The number of laid-off workers seeking unemployment benefits in the week ending July 11 remained stagnant at 1.3 million for the second consecutive week, the Labor Department announced Thursday.

While the numbers have been steadily declining for 14 weeks, the latest data remains at a historically high level indicating that many companies continue to cut jobs as the COVID-19 outbreak intensifies.