Housing News

Mortgage Rates Just Fell a Bit. Should You Buy or Refinance Now?

In a world where every little bit counts, homebuyers and homeowners just got a little good news as mortgage interest rates fell for the first time in a few weeks.

Rates fell to 6.48% for 30-year, fixed-rate loans in the week ending June 4, according to the latest Freddie Mac data. That’s down from 6.53% in the previous week.

Mortgage rates are also down from where they were at this time last year, when they were 6.85%.

“With mortgage rates in the mid-6% range and income growth outpacing home price growth, housing affordability is marginally improving,” said Freddie Mac Chief Economist Sam Khater in a statement.

Home prices are falling, too. The median listing price for a home fell 2.4% year-over-year in May, which is sharpest drop since 2017, according to Realtor.com.

Beyond that, home prices fell in 35 in the top 50 markets.

This is all combining to put prospective homebuyers in position to capitalize on the market.

And that’s exactly what is happening, according to Realtor.com Senior Economist Jake Krimmel.

“May has extended spring’s quietly promising run,” Krimmel wrote in a post. “Year-on-year listing prices fell for a seventh straight month, while homes under contract rose for a sixth straight month.”

Mortgage applications to purchase a home were up 7% year-over-year in the week ending May 29, according to the Mortgage Bankers Association’s unadjusted purchase index.

Meanwhile, applications from homeowners to refinance their existing loans jumped 20% from the same week last year, according to the association.

“Sellers are pricing to sell rather than pricing to test the market,” Krimmel added. “Buyers, despite rates remaining higher than expected, are still showing up when prices are within budget.”