Current:Home > Contact-usTime to start house hunting? Lower mortgage rates could save you hundreds-InfoLens
Time to start house hunting? Lower mortgage rates could save you hundreds
View Date:2024-12-23 15:12:47
Is the housing market finally getting more curb appeal? The latest data points offer some hope for potential homebuyers and sellers, but monthly sales remain far from their heights of several months ago.
Mortgage rates fell at the fastest pace in months this week. Rates on 30-year mortgages dropped below 6.5% for the first time since May 2023, according to Freddie Mac. Back then, the Fed was still pushing up short-term interest rates in its campaign to slow inflation.
The mortgage rate declines follow two recent reports from the National Association of Realtors with signs that the housing market might be picking up:
◾ Home listings in June rose 23% from the year before. The number of unsold houses also rose to a 4.1-month supply – the highest since May 2020.
◾ Pending home sales grew almost 5% from May, suggesting existing home sales could turn up from June's multiyear low of 3.89 million on a seasonally adjusted annual rate.
How housing interest rates have declined
Mortgage rates have fallen by more than a percentage point from their October peak of 7.79%, according to Freddie Mac. That difference can add up to significant savings on monthly payments for new homebuyers.
Unable to view our graphics? Click here to see them.
How much you could save on mortgage payments
The decline in mortgage rates since October could save homebuyers more than $300 per month, says National Association of Realtors Chief Economist Lawrence Yun. He wrote last week, "Homebuyers who were priced out a few months ago should re-check whether they can enter the homebuying market if they have secure jobs.”
Why the "secure jobs" qualifier?
A weak jobs report last Friday worried stock investors that a recession might be ahead. At the same time, it reassured investors in longer-term bonds that the Fed's policymaking committee will likely start cutting its interest rates at its September meeting. Those bonds and their falling yields, in turn, pushed down this week's mortgage rates.
“The volatile stock market will result in a bit of fluctuation in mortgage rates," Yun said on Friday to USA TODAY. "Though, overall, rates will be lower than in the first half of the year.”
Payments fall on new 30-year fixed-rate mortgage
Even with the improving conditions for homebuyers and sellers, the housing market still faces headwinds.
What's slowing the housing market
◾ Prices higher: Median-priced homes in the U.S. rose to their second consecutive all-time high of $426,000 in June, according to the National Association of Realtors. June was also the 12th consecutive month with a year-over-year price increase.
◾ High mortgage rates: Even though 30-year, fixed-rate mortgages are down significantly this year, they're still about 2 1/2 percentage points above the median of 4% during the past decade.
◾ Potential sellers on the sidelines: Homeowners who took advantage of historically low mortgage rates in recent years haven't been interested in taking on new mortgages, which might be much higher than their current rates.
veryGood! (5)
Related
- RHOP's Candiace Dillard Bassett Gives Birth, Shares First Photos of Baby Boy
- US Rep. Donald Payne Jr., a Democrat from New Jersey, has died at 65 after a heart attack
- Pacers' Tyrese Haliburton says brother called racist slur during NBA playoff game
- Pelosi says Israeli Prime Minister Benjamin Netanyahu should resign
- Old Navy's Early Black Friday Deals Start at $1.97 -- Get Holiday-Ready Sweaters, Skirts, Puffers & More
- Watch: Dramatic footage as man, 2 dogs rescued from sinking boat near Oregon coast
- Cowboys need instant impact from NFL draft picks after last year's rookie class flopped
- Guard kills Georgia inmate at hospital after he overpowered other officer, investigators say
- Bill on school bathroom use by transgender students clears Ohio Legislature, heads to governor
- Tennessee lawmakers pass bill allowing teachers, school staff to carry concealed handguns
Ranking
- Katherine Schwarzenegger Gives Birth, Welcomes Baby No. 3 With Chris Pratt
- Shohei Ohtani showcases the 'lightning in that bat' with hardest-hit homer of his career
- Missouri’s GOP lawmakers vote to kick Planned Parenthood off Medicaid
- Mount Everest pioneer George Mallory's final letter to wife revealed 100 years after deadly climb: Vanishing hopes
- Quincy Jones' Cause of Death Revealed
- Starbucks versus the union: Supreme Court poised to back company over 'Memphis 7' union workers
- Every Mom Wants Lululemon for Their Mother’s Day Gift – Shop Align Leggings, New Parent Bags & More
- How US changes to ‘noncompete’ agreements and overtime pay could affect workers
Recommendation
-
Hurricane-damaged Tropicana Field can be fixed for about $55M in time for 2026 season, per report
-
Tyler, the Creator, The Killers to headline Outside Lands 2024: Tickets, dates, more
-
DOJ paying nearly $139 million to survivors of Larry Nassar's sexual abuse in settlement
-
74-year-old Ohio woman charged in armed robbery of credit union was scam victim, family says
-
Nicole Kidman Reveals the Surprising Reason for Starring in NSFW Movie Babygirl
-
Former Wisconsin college chancellor fired over porn career is fighting to keep his faculty post
-
Wisconsin prison inmate pleads not guilty to killing cellmate
-
Billie Eilish Details When She Realized She Wanted Her “Face in a Vagina”