More homebuyers were taking out mortgages despite climbing rates while the tight housing inventory is showing signs of improving. Nonetheless, many homebuyers are not optimistic about the housing market’s near future.
On the Homebuying Front
Freddie Mac reported the 30-year fixed-rate mortgage averaged 5.30 percent as of May 12, up from last week when it averaged 5.27 percent — one year ago at this time, it averaged 2.94 percent. The 15-year fixed-rate mortgage averaged 4.48 percent, down from last week when it averaged 4.52 percent—it averaged 2.26 percent one year earlier. And the 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.98 percent, up from last week when it averaged 3.96 percent and up from last year when it averaged 2.59 percent.“Homebuyers continue to show resilience even though rising mortgage rates are causing monthly payments to increase by about one-third as compared to a year ago,” said Sam Khater, Freddie Mac’s chief economist. “Several factors are contributing to this dynamic, including the large wave of first-time homebuyers looking to realize the dream of homeownership. In the months ahead, we expect monetary policy and inflation to discourage many consumers, weakening purchase demand and decelerating home price growth.”
