Freddie Mac reports that mortgage rates fell to their lowest levels in nine months after the big rise seen in 2018 up until mid-November. The 30-year fixed-rate mortgage fell six basis points to 4.45% with an average 0.50 in points and fees. Freddie Mac said, "In response (to low rates), mortgage applications jumped more than 20%. Lower mortgage rates combined with continued income growth and lower energy prices are all positive indicators for consumers that should lead to a firming of home sales."
Refinancing mortgages is becoming more attractive to Americans now that rates have crept lower in the past two months. At the end of December, a report from Black Knight stated that 2.4 million borrowers could qualify to reduce their interest rates by 0.75% by refinancing. However, while this represents a 29% rise from what was a 10-year low, the total number of refinance candidates is down 50% from last year.
A recent survey by ATTOM Data Solutions revealed that home prices are rising faster than wages in 80% of the markets covered. The result is that renting is becoming more affordable option for Americans. “With rental affordability outpacing home affordability in the majority of U.S. housing markets, and home prices rising faster than rental rates, the American dream of owning a home, may be just that ... a dream, “said Jennifer von Pohlmann, director of content and PR at ATTOM Data Solutions.