After a rapid increase throughout most of the spring, mortgage rates have now declined in five of the past six weeks.
The run-up in mortgage rates earlier this year represented not just a rise in risk-free borrowing costs, but for investors, the mortgage spread also rose back to more normal levels by about 20 basis points. What that means for buyers is good news. Mortgage rates may have a little more room to decline over the very short term.
For Week Ending June 23, 2018
The first half of the year in residential real estate fared as expected, with the most obvious markers continuing to be low inventory and higher prices. We are also seeing decreased affordability in many markets coupled with more urgency (lower days on market) and increased purchase offers (higher pending sales) ahead of perceived future rate increases that have not yet materialized in the wake of the 0.25 percent increase in the federal funds rate. All of this makes for a busy summer. Let’s examine the local market.
In the Twin Cities region, for the week ending June 23:
For the month of May:
All comparisons are to 2017
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
Mortgage rates declined over the past week and have now retreated in four of the past five weeks. The decrease in borrowing costs are a nice slice of relief for prospective buyers looking to get into the market this summer. Some are undoubtedly feeling the affordability hit from swift price appreciation and mortgage rates that are still 67 basis points higher than this week a year ago.
For Week Ending June 16, 2018
Sales across the nation have risen not only because this time of year typically offers an increase in residential real estate activity, but because this year in particular has proven to have strong economic and market conditions. While it’s still true that prices are rising and inventory is tightening, these long-standing trends have been happening gradually enough to not deter those who are serious about becoming homeowners.
In the Twin Cities region, for the week ending June 16:
For the month of May:
All comparisons are to 2017
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
“Buyers need to remain watchful of new listings and make their offers quickly.”
Mortgage rates inched back over the past week and have now declined in three of the past four weeks.
After a sharp run-up in the early part of 2018, mortgage rates have stabilized over the last three months, with only a modest uptick since March. However, existing-home sales have hit a wall, declining in six of the last nine months on a year-over-year basis.
This indicates that persistently low supply levels, and not this year’s climb in mortgage rates, are handcuffing sales – especially at the lower end of the market. Home shoppers can’t buy inventory that doesn’t exist.