As the COVID-19 pandemic has unfolded, many house-hunters have asked some version of this question: Is now really a good time to move? Is it both wise and safe to plan a real estate transaction in the midst of a major health crisis, to say nothing of the ongoing economic uncertainty?
There are a number of factors to consider here, and of course personal health and hygiene are at the top of the list. But as for the financial aspects of homeownership, now may actually be an ideal time to pursue a home purchase. Here’s why: Mortgage rates have been historically low for most of the year… and while they have ticked up just a little bit over the past few weeks, they remain quite competitive.
Mortgage Rates at a Glance
Here are a few fast facts about home loans and where mortgage rates currently stand:
While mortgage rates have ticked up just a little bit, they remain under a three percent average. This places them pretty close to the all-time, historic low.
According to Freddie Mac, the 30-year fixed-rate mortgage rate averaged out to 2.90 percent during the final week of September. The all-time low for rates was set earlier in the month, at about 2.86 percent.
For homebuyers, these rates have made real estate more affordable than ever. In fact, compared to this time last year, mortgage rates have dropped by more than 70 basis points.
The upshot of this? For some homeowners, monthly mortgage payments may have fallen by upwards of $200 over the past year.
What are Mortgage Rates Today?
For a fuller picture of where home loans stand today, here are some quick facts and figures. This data is accurate as of the week ending September 24.
30-year fixed-rate mortgages: Averaged 2.90 percent, with an average 0.8 point, increasing from a 2.87 percent average the week before. This time last year, the average was around 3.64 percent.
15-year fixed-rate mortgages: Averaged 2.40 percent, with an average 0.7 point, up from 2.35 percent a week before. This time last year, the average was 3.16 percent.
5-year hybrid adjustable-rate mortgages: Averaged 2.90 percent, with an average 0.2 point, down a little bit from 2.96 percent the week prior. This time last year, the average rate was 3.38 percent.
Implications of Current Home Loan Rates
The implications here are pretty clear: Home loans are extremely affordable right now, which makes homeownership more accessible to a wider pool of buyers; and, it allows borrowers to potentially get larger or more valuable homes than they would have had access to even a few months ago. Due to these factors, many real estate professionals believe that home sales rates will continue to do well throughout the fall.
Do you have any additional questions about home loans or about where mortgage rates currently stand? Reach out to the team at Loan Fleet to find out more.