Home >> Daily Dose >> The Week Ahead: Will Mortgage Rates Fall Further?
Print This Post Print This Post

The Week Ahead: Will Mortgage Rates Fall Further?

Freddie Mac will release its Primary Mortgage Market Survey on Thursday, February 6, after the latest report revealed a continued drop in rates. 

The average 30-year fixed-rate mortgage fell nine basis points on Thursday to an average rate of 3.51%, according to Freddie Mac’s Primary Mortgage Market Survey. 

“This week’s mortgage rates were the second-lowest in three years, supporting homebuyer demand and leading to higher refinancing activity,” said Sam Khater, Freddie Mac’s Chief Economist. 

“Borrowers who take advantage of these low rates can improve their cash flow by lowering their monthly mortgage payments, giving them more money to spend or save.”

Thursday’s rate is a drop from the prior weeks’ 3.60%. This time last year, the 30-year fixed-rate mortgage averaged 4.46%.

A report by FOX Business states that mortgage rates fell and applications surged due to investors’ growing concerns of how China’s coronavirus could impact economic conditions. 

The Mortgage Bankers Association reported that applications surged 7.2% higher from the week prior for the week ending on January 24. 

Danielle Hale, Chief Economist at realtor.com, told MReport that concerns about the coronavirus’ impact have driven investors into the security of bonds, “accelerating” the drop in 30-year mortgage rates. 

“We expect these lower rates to stick around until the virus is better understood, the transmission is slowed, and treatment improves,” Hale said. 

She added lower rates are one of several factors helping shift the rent-buy tradeoff back toward buying, even though renting remains the short-term winner in many large markets. 

Hale, though, said prospective buyers find homes continue to be an issue, as the market is missing 3.8 million homes. 

“Additional new construction is sorely needed to alleviate the current shortage and meet rising demand,” Hale said.

 

Here's what else is happening in The Week Ahead:

Census Bureau Construction Spending (February 3) 

Unemployment Rates (February 7) 

About Author: Mike Albanese

A graduate of the University of Alabama, Mike Albanese has worked for news publications since 2011 in Texas and Colorado. He has built a portfolio of more than 1,000 articles, covering city government, police and crime, business, sports, and is experienced in crafting engaging features and enterprise pieces. He spent time as the sports editor for the "Pilot Point Post-Signal," and has covered the DFW Metroplex for several years. He has also assisted with sports coverage and editing duties with the "Dallas Morning News" and "Denton Record-Chronicle" over the past several years.
x

Check Also

house, home, housing

Bill Proposed to Accelerate Affordable Housing Development

Bipartisan legislation geared toward raising the housing credit, the Affordable Housing Credit Improvement Act (AHCIA) ...

Subscribe to MDaily

MReport is here for you to stay on top of important developments in the mortgage marketplace. To begin receiving each day’s top news, market information, and breaking news updates, absolutely free of cost, simply enter your email address below.