Mortgage Rates Remain Flat and Slightly Down This Week
Fixed mortgage rates were stable this week, dropping slightly or maintaining their low levels.
Mortgage rates remained largely unchanged from last week, averaging 4.19% for a 30-year fixed rate loan.
Last week, it was 4.20%, and a year ago, the rate was 4.22%.
Meanwhile, the 15-year fixed rate mortgage averaged 3.36%, unchanged from last week.
A year ago, it was 3.29%.
“Mortgage rates were flat to slightly down across the board as GDP was revised up from 4.2% to 4.6% for the second quarter,” said Frank Nothaft, vice president and chief economist at Freddie Mac, in a released statement.
Conventional loans averaged 4.20% last week, according to the Freddie Mac Primary Mortgage Market Survey, a weekly poll of rates being quoted to consumers by 125 lenders across the country.
Last year this time, conventional mortgage rates averaged 4.22%.
Also, the S&P/Case-Shiller National Home Price Index showed a significant slowdown in price increases.
“The broad based deceleration in home prices continued in the most recent data,” said David M. Blitzer, chairman of the Index committee at S&P Dow Jones Indices, in a statement. “However, home prices continue to rise at two to three times the rate of inflation.”
In addition, pending home sales in August were down 1%, according to the National Association of REALTORS®. The Pending Home Sales Index tracks contract signings. It is a forward-looking indicator that parallels closed sales data.
“With investors pulling back, the market is shifting more towards traditional and first-time buyers who rely on mortgages to purchase a home,” said Lawrence Yun, NAR chief economist, in a statement.
Yun forecasts existing homes sales to decline 3% this year to 4.94 million annual sales—compared to 5.09 million sales last year—despite low interest rates and slower price growth. He projects median home prices to increase 5% to 6% this year and then fall to 4% to 5% in 2015.
“Jobs and income gains will help repay student debt and better position first-time buyers, setting the stage for improved sales growth in upcoming years,” he noted in the statement.