Skip to footer

Mortgage rates fall, and there's relief for homebuyers in some hot markets

Mortgage rates dropped slightly this week while mortgage applications, particularly refinance loans, also fell. Meanwhile, if you’re in one of the busier housing markets in the country and have been struggling to find a home, some relief may be on the way

|
Pat Sullivan/AP/File
Signs stand outside new townhouses in Houston. Thirty-year mortgage rates fell to 3.61 percent this week.

Reversing gains made last week, mortgage rates dropped slightly this week while mortgage applications, particularly refinance loans, also fell. Meanwhile, if you’re in one of the busier housing markets in the country and have been struggling to find a home, some relief in home prices and inventory might be headed your way, according to a new report.

Freddie Mac’s just-released weekly survey of lenders shows the following average rates for the most popular home loan terms:

  • 30-year fixed-rate mortgages averaged 3.61% with an average 0.6 point for the week ending May 5, 2016. A year ago, the rate averaged 3.8%.
  • 15-year fixed rates averaged 2.86% with an average 0.5 point. The same term priced at 3.02% a year ago.
  • 5-year adjustable-rate mortgages priced at 2.80% with an average 0.5 point. Last year at this time, the same ARM averaged 2.9%.

“The Fed’s decision to stand pat followed by a week of assorted unsettling news drove Treasury yields lower,” Sean Becketti, chief economist for Freddie Mac, said in a release.  “As a consequence, the 30-year mortgage rate drifted down to 3.61%, just three basis points above the low for the year. Since the start of February, mortgage rates have varied within a narrow range, providing an extended period for house hunters to take advantage of historically low rates.”

Meanwhile, new home loans are flat as mortgage applications fell 3.4% for the week ending April 29, 2016, according to the Mortgage Bankers Association.

Purchase applications increased infinitesimally by 0.1%, as refi applications dropped 6% from the previous week. Overall, home purchase applications remain 13% higher than the same week one year ago.

Trulia: Hot markets slowing, Bargain Belt rebounding

It’s no secret that some of the nation’s hottest markets have created a conundrum for homebuyers faced with fewer affordable options and shrinking inventory. But there are some promising signs that some of the fastest-paced markets on the East Coast and West Coast may be slowing down while sluggish post-downturn markets are (finally) picking up speed, according to the latest Trulia Fastest Moving Markets Report.

The report, released Wednesday, analyzes how fast homes are selling and how those particular markets have fared in the past year. Overall, if you look at the national picture, homes are moving off the market faster today than this time last year.

Nearly 67% of homes are still on the market after 30 days, which is a dip from 67.8% in 2015, Trulia found. Although San Francisco saw a 41.3% slowdown in year-over-year time on market, it’s worth nothing it also has a median asking price of $1.05 million — one of the highest in the country.

But in some areas, homes are moving off the market slower today than a year ago. Below is Trulia’s breakdown of the top 10 U.S. metros, followed by the percentage change of homes on the market after a month from April 2015 to April 2016:

  1. Houston, TX — 66.3%
  2. San Francisco, CA — 41.3%
  3. North Port-Sarasota-Bradenton, FL — 72.4%
  4. Madison, WI — 75.2%
  5. Miami, FL — 75.1%
  6. Phoenix, AZ — 65.6%
  7. Cape Coral-Fort Myers, FL — 72.0%
  8. Oakland, CA — 39.8%
  9. Sacramento, CA — 58.7%
  10. Fort Lauderdale, FL — 69.6%

Trulia also lists the fastest- and slowest-moving housing markets. It’s no surprise that the greater San Francisco Bay Area is king when it comes to fast-paced regions, even with the slowdown in San Francisco proper, and it has plenty of company on that list, including other western cities like Seattle, Denver, Salt Lake City, and Portland, Oregon.

The biggest pickups are being seen in the South. The top 10 markets where houses are selling faster than a year ago include Charlotte and Raleigh, North Carolina; Louisville, Kentucky; and Atlanta. These markets also have median prices at or well below $220,000, making them more affordable markets for first-time buyers who might be outpriced in costlier metro areas.

Deborah Kearns is a staff writer at NerdWallet, a personal finance website. Email:dkearns@nerdwallet.com. Twitter: @debbie_kearns.

 This article first appeared in NerdWallet.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.
editor@csmonitor.com
Subscribe
Mark Sappenfield
Editor

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

Subscribe to insightful journalism

QR Code to Mortgage rates fall, and there's relief for homebuyers in some hot markets
Read this article in
https://www.csmonitor.com/Business/Saving-Money/2016/0506/Mortgage-rates-fall-and-there-s-relief-for-homebuyers-in-some-hot-markets
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe