Rates ease last week

 Mortgage rates eased last week.  Per Forbes,

Rates for home loans fell last week as concerns about an economic slowdown mounted. But for anyone still trying to buy, the pullback in rates may spell opportunity.

The 30-year, fixed-rate mortgage averaged 5.7% for the week ending June 30, down 11 basis points—one one-hundredth of a percent—from the previous week, according to Freddie Mac. A year ago at this time, it averaged 2.98%.

What’s Ahead for Mortgage Rates

There are still plenty of Americans who want to buy a home, as evidenced by applications for mortgages. A measure of weekly application activity hit its lowest in 22 years earlier in June but has since edged higher as rates have fallen, according to the Mortgage Bankers Association (MBA).

There may yet be opportunities for would-be buyers. MBA economists forecast the 30-year, fixed-rate mortgage will average 5% throughout 2022, suggesting it may pull back after the recent surge.

Meanwhile, more sellers are listing their homes for sale. In June, the number of new listings was nearly 19% higher than a year ago, according to a report from Realtor.com. “Home shoppers are still snatching up homes quickly, but there are early signs of relief,” the report noted.

It may seem ironic, but some of that relief for would-be buyers comes courtesy of big economic headwinds. As Freddie Mac’s chief economist, Sam Khater, said in a release, “The rapid rise in mortgage rates has finally paused, largely due to the countervailing forces of high inflation and the increasing possibility of an economic recession.”

Buyers Gain a Slight Advantage

The extreme seller’s market of the past few years isn’t over, but buyers may now have a slightly better shot at getting a home, especially if they’re strategic.

“Buyers are looking but they’re being more discerning,” says Maura Neill, a Realtor with RE/MAX Around Atlanta.

Neill describes the current market as being in a bit of a lull, thanks to a “slight rise in inventory combined with higher rates, higher inflation, and uncertainty about all those things.”

One of the best things a buyer can do, Neill says, is to have some perspective. Rates right now seem high, but that’s because they’ve been deeply depressed for the past two years. And they may fall again in the future.

“Marry the house but date the rates,” Neill advises. “If you can afford the house, buy it, and plan to refinance when rates come back down.”