Homebuyers and homeowners rejoice: Mortgage rates are down this week. However, high home prices have caused sales of new homes to take a dive.
With the new-home market feeling the pain that has been seen among resales, would-be buyers have been taking a time out on real-estate shopping.
So while now’s a great time to snag a killer mortgage deal, finding an affordable home — whether it’s new or pre-owned — could prove to be more of a challenge.
Looking to stay ahead of the financial game? Bankrate is here to fill you in on what’s happening around the country this week:
Home sales cool off
Mortgage rates are hovering around 4 percent, allowing homeowners to refinance at a lower rate and homebuyers to get great financing.
But that’s not enough to convince buyers to make their move.
In July, sales of new homes fell 9.4 percent from June’s level, and slumped by 8.9 percent compared with the numbers from July 2016, according to monthly government data.
Until more new homes are built and more existing homeowners decide to sell, to add desperately-needed inventory to the market, it seems buyers are holding their breaths.
Is new construction headed for a slowdown?
In addition to dismal new-home sales, housing starts, new building permits and new-home completions fell across the board in July.
But builders are feeling cautiously bullish about things. Builder confidence jumped 4 points in August on the National Association of Home Builders/Wells Fargo Housing Market Index.
“Our members are encouraged by rising demand in the new-home market,” NAHB Chairman Granger MacDonald said, in a news release. “This is due to ongoing job and economic growth, attractive mortgage rates, and growing consumer confidence.”
Mortgage rates fall
The benchmark 30-year fixed-rate mortgage fell this week to 4.02 percent from 4.05 percent, according to Bankrate’s weekly survey of large lenders. A year ago, it was 3.57 percent. Four weeks ago, the rate was 4.09 percent. The 30-year fixed-rate average for this week is 0.42 percentage points below the 52-week high of 4.44 percent, and is 0.48 percentage points above the 52-week low of 3.54 percent.
The 30-year fixed mortgages in this week’s survey had an average total of 0.31 discount and origination points.
Over the past 52 weeks, the 30-year fixed has averaged 4.06 percent. This week’s rate is 0.04 percentage points lower than the 52-week average.
The 15-year fixed-rate mortgage fell to 3.23 percent from 3.27 percent.The 5/1 adjustable-rate mortgage rose to 3.50 percent from 3.49 percent.The 30-year fixed-rate jumbo mortgage fell to 4.03 percent from 4.07 percent.
At the current 30-year fixed rate, you’ll pay $478.57 each month for every $100,000 you borrow, down from $480.30 last week.
At the current 15-year fixed rate, you’ll pay $701.70 each month for every $100,000 you borrow, down from $703.64 last week.
At the current 5/1 ARM rate, you’ll pay $449.04 each month for every $100,000 you borrow, up from $448.49 last week.
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