The average interest rate on a 30-year fixed-rate mortgage fell to 2.86% this past week, according to Freddie McK. That’s the lowest level in nearly 50 years of mortgage giant surveys. The 15-year fixed rate mortgage has fallen to 2.37%.
“Mortgage rates have reached record lows every second due to the slow pace of recovery over the summer,” said Sam Terter, chief economist at Freddie McKay.
This has helped create strong demand for home sales at low rates, Khatar said. But he warned that maintaining a level of enthusiasm to buy a home would be difficult.
He said it would be difficult to sustain the pace of growth in buying coming in the fall as the lack of supply already hindered sales activity.
Nevertheless, buying activity is strong, said Joel Kane, associate vice president of economic and industry forecasting for the Mortgage Bankers Association. During the week ended September, applications for new mortgages increased by almost%% over the previous week. The average loan size continued to increase, hitting ting 368,600, the highest amount since MBA started tracking in 1990.
George Retiu, a senior economist at Realtor.com, said: “Home buyers continue to offer offers on homes, pushing existing inventories to historic lows.” “Commercial sellers are stuck in their homes, struggling to find their next home amid a shortage of supplies, and contributing more to the decline in inventory.”
And the limited supply of homes is also pushing up prices, Retu said.
Mortgage rates spark for refinancing
The new record low interest rates also have an impact on the number of homeowners who could potentially refinance their existing loans.
There are now 19.3 million high-quality refinancing candidates, according to mortgage data company Black Knight. Payee reports that this represents 43% of the 30-year mortgage holders.
Black Knight defines high-quality refinancing candidates as 30-year mortgage holders with a credit score of 50 or more who have at least 20% equity in their home, are current on their mortgage payments, and who want to shave at least 0.75% of their mortgage. Standing. Rate by refinancing.
According to Black Knight, that average savings of 19.3 million homeowners is 9,299 per month.
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