Freddie Mac reported the first week in July, a 3.03% decline in the average rate on a 30-year fixed-rate mortgage. This was a dip from 3.07% the week prior and 3.13% just two weeks before. In fact, the 30-year fixed-rate averaged around 3.75% this time last year. The 15-year fixed-rate mortgage reported at 2.51% at the beginning of July, down from 2.56% the week ending June and 3.75% this time last year.
Since the inception of Freddie Mac’s reporting in 1971, the beginning of July 2020 ranked the lowest levels they have seen to date making this the third consecutive week of record lows. The Primary Mortgage Market Survey reported the U.S. Weekly averages as of July 16, 2020, were 2.98% for a 30-year fixed-rate mortgage, 2.48% for a 15-year fixed-rate mortgage and 3.06% for a 5/1-year ARM. Freddi Mac reports that “these low rates have been capitalized into asset prices in support of the financial markets.”
Lower rates are making homes for sale more affordable. Homebuyers are ready to buy as the shut-in orders are lifted. The National Association of Realtors released data showing a jump of 44.3 percent in May of pending home sales. In June home purchases rose 20.7% from the decrease from the pandemic. According to the NAR’s existing homes rose last month to a seasonally adjusted annual rate of 4.72 million.
“The summer is heating up as record-low mortgage rates continue to spur homebuyer demand,” said Sam Khater, Freddie Mac’s Chief Economist.
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