Hello valued customers and readers,
The recent fluctuations in the mortgage market are having a notable impact on home buyers, sellers, and current homeowners alike. I felt it imperative to provide you with an update on where things stand and how they might affect your real estate plans. Here's a snapshot of what's been happening.
Mortgage Rates on the Rise
As the Federal Reserve made the move to hike rates, the ripple effects were quickly felt in the mortgage sector. According to Freddie Mac’s recent Primary Mortgage Market Survey, the 30-year fixed-rate mortgage now sits at an average of 7.49%, while the 15-year fixed-rate mortgage is at 6.78%.
Freddie Mac's Chief Economist, Sam Khater, remarked on this upward shift, pointing out that this is among "the highest mortgage rates in a generation". Several contributing factors, from inflationary trends, shifts in the job market, and prevailing uncertainties surrounding the Federal Reserve's future decisions, have all played a role in this rate hike.
Mortgage Applications: A Dwindling Trend
With the rise in rates, we're also witnessing a slowdown in mortgage applications. Based on the latest data from the Mortgage Bankers Association (MBA), there's been a 6% decline in applications from the previous week. Joel Kan, MBA’s Vice President and Deputy Chief Economist, pointed out that the rates for all mortgage products have gone up, leading to a significant drop in applications, hitting the lowest level since 1996.
The Implications of Mortgage Bonds
But that's not the only influencing factor at play. The mortgage bond market has been hit due to a sell-off in government bonds combined with the Fed's tightening message. Yahoo News reported that the asset class is now nearing its post-financial crisis record from May. To put it in simpler terms, higher yields in the mortgage bond market usually translate to even steeper mortgage rates for potential home buyers.
A Look at Mortgage Fraud
While the market's trajectory might seem challenging, there's a silver lining in the cloud of data. A report from CoreLogic indicates that the risk of mortgage fraud rose by 1.6% between the first and second quarter of this year. However, there's been a 3.1% annual decline, offering a somewhat relieving perspective. Their study found that between April and June, just about 0.75% (or one in every 134) of mortgage applications showcased signs of fraud.
In Closing
Navigating the current mortgage landscape requires careful consideration and informed decision-making. As your trusted realtor, I'm here to guide you through these challenging times and ensure you're equipped with all the knowledge you need. Whether you're looking to buy, sell, or refinance, understanding the market's pulse is paramount.
For personalized advice or more insights, feel free to reach out. Let's navigate these waters together.
Warm regards,
Kevin Farfan LLC GRI, PSA, RENE, MRP, C-RETS
Coldwell Banker Realty
213 W. Bloomingdale Ave.
Brandon, FL. 33511
Cell 813-784-7139
website: www.kevinfarfanllc.com
"I Sell Lifestyles!"