Why It’s Harder to Buy a Home
It’s getting harder to buy a home in this economy. We should pray that Americans are able to afford what they need.
From CNBC. In June the average rate on the 30-year fixed shot over 6% briefly, and that was enough to turn the once-hot housing market on its heels. Rates pulled back in July and August, but the damage was already done. Now rates are heading past 6% yet again, causing already beleaguered mortgage demand to fall even further.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.94% last week from 5.80% the previous week, for loans with a 20% down payment, according to the Mortgage Bankers Association. …
Mortgage applications to purchase a home dropped 1% for the week and were 23% lower than the same week one year ago. Given today’s higher rates, a person buying a $400,000 home would pay close to $700 more per month than they did a year ago. …
Mortgage rates shot even higher to start this week, as investors await a slew of speeches by Federal Reserve members that could give more insight into how large the next rate hike might be. Higher mortgage rates are already cooling home prices, but given how far they rose in the past few years, it will likely take significantly more cooling before affordability fully recovers.
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(Excerpt from CNBC. Photo Credit: Canva)
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