Mortgage rates ticked down slightly this week, a tiny boon to buyers eager to make a move with newly listed homes coming to market.
The 30-year fixed-rate mortgage averaged 6.88% in the week ending March 7, down from 6.94% the previous week, according to data from Freddie Mac released Thursday. A year ago, the average 30-year fixed-rate was 6.73%.
“Evidence that purchase demand remains sensitive to interest rate changes was on display this week, as applications rose for the first time in six weeks in response to lower rates,” said Sam Khater, Freddie Mac’s chief economist said in a statement.
Thursday’s decline caps a four-week streak of rising rates which had done little to chill the homebuyer market and will likely draw even more people to the spring market.
Applications for mortgages were up 9.7% in the week ending March 1 from the week before, according to the Mortgage Bankers Association.
Applications for a loan to purchase a home were up 11% from a week earlier, while refinance applications rose 8% from a week earlier, on a seasonally adjusted basis – although both were below levels reached a year ago.
Also, applications for Federal Housing Administration loans were up last week, demonstrating an interest from first time home buyers, according to the MBA report.
Still, with homebuyers struggling in one of the least affordable markets in decades, mortgage rates are one of the biggest — and most persistent — hurdles for potential homebuyers, he said, in addition to stubbornly low inventory.
“It’s important to remember that rates can vary widely between mortgage lenders so shopping around is essential,” Khater added.
This is a developing story and will be updated.
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