admin August 8, 2019


Mortgage rates dropped significantly over the past week as concerns related to the ongoing trade dispute with China and the overall health of the economy dominated headlines.

The 30-year fixed-rate mortgage averaged 3.6% during the week ending Aug. 8, down 15 basis points from the previous week, Freddie Mac reported Thursday. This is the lowest mortgage rates have been since the 2016 presidential election.

This was the third-largest weekly decline for the 30-year fixed-rate mortgage this year — so far in 2019, rates for the loan product have only posted a weekly increase on eight occasions.



The 15-year fixed-rate mortgage also dropped 15 basis points to an average of 3.05%, according to Freddie Mac. The 5/1 adjustable-rate mortgage averaged 3.36%, representing a decline of 10 basis points.

Mortgage rates track the 10-year Treasury note












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the yield on which has fallen sharply over the past year.


‘Some millennials are missing out on a once-in-a-generation opportunity.’


—Nela Richardson, an investment strategist at Edward Jones


While the Federal Reserve did choose to cut the Fed funds rate last week, that change has already been priced into mortgage rates. This week’s decline likely reflected the growing worries in financial markets, including concerns about the ongoing trade-war between the U.S. and China.

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“There is a tug of war in the financial markets between weaker business sentiment and consumer sentiment,” Freddie Mac












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said in its report. “Business sentiment is declining on negative trade and manufacturing headlines, but consumer sentiment remains buoyed by a strong labor market and low rates that will continue to drive home sales into the fall.”

Ultimately, the low supply of homes available for sale will at least partially stymie any boost low mortgage rates would otherwise give to the housing market.

“Rates are low, but does it matter if you can’t find anything you can afford?” said Nela Richardson, an investment strategist at Edward Jones












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Business sentiment is down on negative trade and manufacturing headlines.


—Freddie Mac’s latest report


This is especially bad news for would-be home buyers who could stand to save significantly, given how home prices have reached record highs across much of the country. “Some millennials are missing out on a once-in-a-generation opportunity because we think rates will go up again,” Richardson said.

But some experts are hesitant to say that the declines in mortgage rates throughout 2019 will meaningfully provide a lift to the housing market.

The week’s drop in mortgage rates did spur a major uptick in home-loan applications, but most of this activity centered on refinances rather than loans used to purchase homes.



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