Home Buyers Take a Breather From Rising Mortgage Rates
Home buyers have had a three-week respite from rising mortgage interest rates, and the average rate on a 30-year fixed-rate home loan fell to 5.98% last week, according to Freddie Mac, the first time it has dropped below 6% in eight weeks.
According to Amy Crews-Cutts, Freddie Mac’s deputy chief economist, the recent stability in mortgage rates is an indication that investors in the bond markets have been calmed by reassurances that the Federal Reserve won’t be increasing its federal funds rate for the balance of this year.
“The housing market is still very hot due to still-low interest rates,” said Crews-Cutts. “Recent home sales and housing starts numbers are off the charts and will set another big record in 2003.”
In remarks to the NAHB Board of Directors in Boston earlier this month, NAHB Chief Economist David Seiders noted that rising mortgage interest rates since mid-June had taken a toll on the refinancing boom, “but the impacts on home buying apparently have been quite limited to date.”