Low Mortgage Rates have yet to Fuel Home Sales
July 28, 2010
Tips & Trends
From Rory S. Coakley on some of the latest real estate news and happenings.
Mortgage rates for 30-year fixed loans were unchanged this week at the lowest point in decades, but it hasn’t been enough to jump-start the housing market.
Government-sponsored mortgage buyer Freddie Mac said Thursday that the average 30-year fixed rate was 4.57 percent. That’s the same as a week earlier, and the lowest since Freddie Mac began tracking rates in 1971.
The last time home loan rates were lower was the 1950s, when most mortgages lasted 20 or 25 years.
Rates on 15-year fixed-rate mortgages decreased to an average of 4.06 percent, down from 4.07 percent last week. Rates on five-year adjustable-rate mortgages averaged 3.85 percent, up from 3.75 percent.
Rates on one-year ARMs fell to an average of 3.74 percent from 3.75 percent. This week’s average is the lowest the one-year ARM has been since Freddie Mac began following it in 1984.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for all types of loans in Freddie Mac’s survey averaged 0.7 points.
Rates have fallen since the spring. Investors, concerned with the European debt crisis, have poured money into the safety of Treasury bonds. Treasury yields have fallen and so have mortgage rates, which tend to track yields on U.S. debt.
But low rates have yet to fuel home sales and have sparked only a modest increase in refinancing.
Mortgage applications dropped last week as requests for purchase financing declined 3.1 percent to the lowest level in more than 13 years, the Mortgage Bankers Association said Wednesday. An index measuring refinancing fell 2.9 percent, the MBA said.
Rates could go lower and still not budge the housing market, analysts say. That’s because a person without a job can’t afford a home; a person worried about losing a job is unlikely to buy one, either.
To calculate the national average, Freddie Mac collects mortgage rates Monday through Wednesday from lenders around the country. Rates often fluctuate significantly, even within a given day.
If you would like to suggest a topic for comment in one of our future emailers, please let me know. You can always reach me at firstname.lastname@example.org or by phone 301-340-8700. I look forward to hearing from you!
Rory S. Coakley
Coakley Realty, Inc.
20 Courthouse Square, Suite 107
Rockville, MD 20850
FIND THE PROPERTY YOU NEED.PROPERTY SEARCH
CONTACT US TODAY
Featured Real Estate Listings
- Residential 9476 Newbridge Dr,
Potomac, MD 20854
ENTERTAINER'S DELIGHT! Stunning 2 acre lot located in sought after Falconhurst. Spectacular, private yard features newly renovated pool, pool house w/ FB, tennis courts & beautiful sun filled patio. Enjoy the spacious kitchen, formal living & dining rooms,1st floor office, fin bsmt, storage & 3 car garage. Two story family room features over sized windows & offers scenic views of the backyard.VIEW LISTING
- Residential 23400 Woodfield Rd,
Gaithersburg, MD 20882
Mitchell & Best Home on gorgeous 2+ acre lot in Watkins Preserve - a subdision offering 5 additional lots! 5,700 SF (3,934 fin above grade) incl. 4 bdrms, 3.5 baths, 2 car gar, & a full W/O bsmt. 1st fl features office, formal liv& dining rms, gourmet kitchen w/ cntr island, brkfast area & lg family rm w/ FP. Enjoy the gorgeous sunset views from the spacious deck!VIEW LISTING
- Lot 11013 Riverwood Dr,
Rockville, MD 20854
GORGEOUS 2+ acre lot in heart of Potomac. At the end of prestigious Riverwood Drive, this lot is on a cul de sac. Public water & sewer & gas available. Enjoy all that Potomac has to offer: Potomac Village features shops, restaurants, supermarkets, Starbucks and more! Outdoor enthusiasts will love Swains Lock & Great Falls Park. Country Clubs, equestrian facilities,& sought after schools nearby.VIEW LISTING