Monday, July 6, 2020 / by Vanessa Saunders
By Vanessa Saunders, MBA, MIMC , Broker Owner, Global Property Systems Real Estate.
It's happened again. Mortgage rates have eased down another few points to hit a new all-time low. According to Freddie Mac's latest figures, released July 3, the average rate for a 30 year fixed rate mortgage came in at 3.07%. The previous low (which Thursday's beat) was 3.13%. Last year at this time, the rate was 3.75%.
Sam Khater, Freddie Mac’s chief economist, said in a statement, “Mortgage rates continue to slowly drift downward with a distinct possibility that the average 30-year fixed-rate mortgage could dip below 3 percent later this year.On the economic front, incoming data suggest the rebound in economic activity has paused in the last couple of weeks with modest declines in consumer spending and a pullback in purchase activity.”
Equally unheard-of, Freddie put the 15-year fixed-rate mortgage average at 2.56 percent, down slightly from last week’s 2.59 percent, beating last year’s 3.18 percent average.
Curiously, mortgage applications fell last week despite the drop in rates. The boogie-man that is scaring buyers away is explained by some economic forecasters as our old friend Covid-19. Investors are afraid of a recent resurgence in COVID-19 cases negatively affecting the labor market and economy.
Economists read the decline as a signal that all the demand we have recently seen may be starting to slow as a low housing supply limits buyer's options. According to Mark Fleming, chief economist for First American, "Our research has also found that in past recessions, house prices show their ‘downside stickiness,’ meaning they remain flat or their growth slows during economic downturns, but often do not decline much,” Fleming said. “Because of this, in the near term, we anticipate nominal house price appreciation to accelerate this summer.”
What does all this mean for home sellers and buyers in the Hudson Valley? With record-low interest rates and accelerated housing prices expected, now is an excellent time to sell your home. Contact us to help you find the answers to any questions you may have about buying or selling a home in the Hudson Valley.