Mortgage Rates Decline Marginally Amidst Economic Data Calm
Mortgage rates experienced a slight decrease this week amid a lull in economic data releases. According to Freddie Mac, the average 30-year fixed-rate mortgage stands at 6.85%, down from 6.87% a week prior. The 15-year mortgage rate has also declined, from 6.09% to 6.04%.
Financial markets remained largely unfazed by last week's higher-than-anticipated inflation data. Moreover, there were no significant releases this week that altered investor sentiment regarding inflation and the Fed's rate hike trajectory. 10-year Treasury yields, which closely correlate with mortgage rates, have remained relatively stable around 4.5%.
While mortgage rates have gradually declined in recent weeks, they remain elevated near 7%. This level continues to pose affordability challenges for prospective homebuyers. Mortgage applications for home purchases fell 6% week-over-week, and refinancing applications dropped 7%, hitting their lowest point of the year.
"Prospective homebuyers are anticipating improvements in supply and affordability before entering the market," stated Bob Broeksmit, President and CEO of the Mortgage Bankers Association.
Despite these challenges, Freddie Mac's chief economist, Sam Khater, expressed optimism that five consecutive weeks of rates below 7% could bolster buyer and seller confidence as the spring home-buying season approaches.