Mortgage rates drop to recent low
Posted on Friday, September 27, 2013 at 11:29:01 AM
In the middle of September, the Federal Reserve announced that it would not begin tapering its bond-buyback program. The news caught some experts off guard, and in the wake of the decision residential financing rates began to decline.
At the moment, rates are now at a nine-week low, according to the Freddie Mac Primary Mortgage Market Survey. A 30-year fixed-rate mortgage averaged 4.32 percent, a decline from last week's average of 4.5 percent.
Overall, rising home prices and greater affordability have helped stimulate the housing market, according to Freddie Mac.
"These increases in home values have also increased homeowner wealth," said Frank Nothaft, chief economist for Freddie Mac. "For example, homeowners experienced an aggregate $1.4 trillion increase in equity in their homes over the first half of this year which contributed to the overall $4.2 trillion gain in household net worth."
In addition, mortgage applications also trended positively alongside residential financing rates. Over the past week, applications saw a 5.5 percent increase, according to the Mortgage Bankers Association. The Refinance Index also grew on a weekly basis, up 5 percent.
At the moment, the Fed will continue its economic policies designed to help the housing market. Higher affordability and lower mortgage rates are positives for buyers and sellers of real estate.