Ruth Mills Team
San Diego Realtor
San Diego News & Real Estate Blog
Mortgage Rates Move Up from Historic Lows
Mortgage Rates rose this week after reaching historic low levels a week ago, with the 30-year, fixed-rate average dipping below 4 percent for the first time in history. Freddie Mac reported the average for the 30 year loan at 4.12 percent in the week ended October 14th, a week after averaging 3.94 percent, the lowest average ever according to the National Bureau of Economic Research.
The average rate for a 15 year fixed loan also rose after reaching a record low of 3.26 percent last week, to 3.37 percent. Rates have remained below 5 percent for all but two weeks over the last year, but that hasn't helped spur sales in the struggling housing market. Sales are on pace to be slower this year than any time during the last 14 years, and new home sales are in even worse shape, on pace for their worst year on records dating back 50 years.
Many Americans are simply hesitant to take on the risk of home ownership in today's tough economic conditions, with unemployment having been at or above 9 percent and wages in decline. Lenders, meanwhile, have raised borrowing standards to the point that many potential homebuyers are unable to qualify for financing. Refinancing activity has been impacted, as well, as declining home values have reduced equity to the point that many can't qualify.