30-year mortgage rates edge down for third week in a row

Mortgage rates fell slightly again, marking the third straight week of declines, according to Freddie Mac. (iStock)

Mortgage rates fell slightly for the third week in a row, according to new data by Freddie Mac.

The 30-year fixed rate mortgage declined slightly to 5.09% of the annual percentage rate (APR) for the week ending June 2, 2022. This is a slight decrease from 5 .1% last week, but up from 2.99% last year.

“Mortgage rates have continued to decline slightly this week, but are still significantly higher than last year, affecting affordability and buying demand,” said Freddie Mac chief economist Sam Khater. “As summer approaches, the pool of potential buyers has shrunk, supply is up, and the housing market is normalizing. This is welcome news after the unprecedented market tightening over the past two last years.”

However, the 15-year mortgage rose slightly to 4.32% from 4.31% Last week and 2.27% last year. The five-year Treasury-indexed hybrid variable-rate mortgage (ARM) averaged 4.04%, down from 4.2% last week, but up from 2.64% last year.

If homeowners want to take advantage of current mortgage rates, they can consider refinancing to save money on monthly payments. Visit Credible to find your personalized interest rate without affecting your credit score.

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Another interest rate hike could come from the Federal Reserve

The Federal Reserve rising interest rates by 50 basis points at its May meeting, the biggest rate hike in about two decades. Earlier, the Federal Open Market Committee raised interest rates by 25 points at its March meeting. But the Fed is expected to raise rates several more times this year and into 2023 as it fights high inflation for decades.

“After a tumultuous month characterized by widespread concern about inflation and the possibility of a recession, the stock market ended May about where it started after a rally last week,” Hannah said. Jones, economic data analyst at Realtor.com. “In a meeting with Federal Reserve Chairman Powell and Treasury Secretary Yellen, President Biden expressed support for the Fed’s actions to control inflation and pledged to refrain from influencing interest rate decisions.

“Powell and Fed officials have continued to stress their commitment to take action in upcoming meetings to bring prices under control and achieve 2% inflation,” Jones said. “In line with this objective, year-on-year consumer price growth slowed in April for the first time since August 2021, from 8.6% in March to 8.2% in April, a welcome sign of progress.”

If you’re looking to take advantage of mortgage rates before they go up, consider refinancing to lower your monthly payment. Visit Credible to compare multiple mortgage lenders at once without affecting your credit score.

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Affordability challenges slow home buying activity

As skyrocketing house prices and with mortgage rates still higher than at the same time last year, affordability continues to be a challenge for potential buyers.

“The decline in mortgage rates over the past two weeks has offered some relief to buyers who have had to contend with relentlessly rising home prices,” Jones said. “High prices and recent interest rate hikes dampened buyer activity in April, as seen by the month-over-month decline in existing home sales (-2.4%), new home sales (-16.6%) and pending home sales (-3.9%) as some buyers pulled out of the market altogether.”

House prices jumped to brand new heights in March, according to the latest Case-Shiller report. They reached an annual increase of 20.6% despite the expectation that growth may soon begin to slow.

“Homebuyers continued to face record property prices in May, however, hope is on the horizon as housing data from last week shows a further increase in the number of homes for sale compared to to last year,” Jones said. “And while stocks are still low by historical standards, they are starting to move in a more buyer-friendly direction. This will likely lead to slower price growth in the not-too-distant future as sellers scramble buyers, ultimately creating a more balanced market.However, those currently teleshopping will tell you that we are not there yet, as continued high interest rates and house prices are making it difficult to find their home ideal.

If you’re considering buying a home in today’s real estate market or want to refinance your current loan amount to lower your interest rate, comparing several options can help you save money. Contact Credible to speak with a mortgage expert and get your questions answered.

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