Mortgage Rates Fall to New Record Lows
Mortgage rates continue to go down. In fact, according to Freddie Mac, during the last week of September, the average rate on a 30-year fixed rate mortgage reached the lowest point since long-term mortgages began in the 1950s.
“The markets are responding to the recent decision by the Federal Reserve to buy mortgage-backed securities, and consumers are the beneficiaries,” said Steve Adamo, president of Weichert Financial Services. “These incredibly low rates coupled with still attractive home prices make buying a home more affordable now than at almost any point in history.”
Even if you are not in the market to buy a home you can benefit. As a Seller you will likely see increased showing activity. If you currently own a home you might be able to refinance to lower your mortgage costs.
August Pending Home Sales Up From Year Ago
After reaching a two-year peak, pending home sales fell slightly in August but are at elevated levels compared with a year ago, according to the National Association of Realtors (NAR). Its Pending Home Sales Index, a forward-looking indicator based on contract signings, declined 2.6 percent from July but is 10.7 percent above August 2011.
To put this report into perspective, consider that contract activity in July 2012 was at the highest level since April 2010 when buyers were rushing to beat the deadline for the home buyer tax credit. In addition, the index has shown 16 consecutive months of year-over-year increases.
Lawrence Yun, NAR chief economist, said some volatility can be expected in the monthly readings. “The performance in month-to-month contract signings has been uneven with ongoing shortages of lower priced inventory in much of the country, and across most price ranges in the West, but activity has remained at notably higher levels this year,” Yun said.
More homes under contract translates into more closed home sales in the next several months, which helps contribute to the ongoing real estate recovery.