Mortgage rates drop again, but many buyers prefer to wait
- Yahoofinance
- Dec 6, 2023
- 2 min read
The average rate on the popular 30-year fixed mortgage decreased to 7.22% from 7.29% the prior week, Freddie Mac released Thursday. Since the end of October, rates have dropped more than a half-point, but still haven’t dipped below 7% for over three months.
'The majority of buyers don’t want to buy’
The recent decline in rates has coaxed some buyers back to the market. The volume of purchase applications increased 5% on a seasonally adjusted basis for the week ending Nov. 19, according to the Mortgage Bankers Association (MBA).
Still, overall purchase activity remained nearly 20% lower than a year ago.
The median home price jumped 3.4% year over year to $391,800 — the highest level for the month of October.
Homebuilder confidence fell to its lowest point in a year this month, according to the National Association of Home Builders, marking its fourth consecutive monthly drop in sentiment. The decline was driven by the uptick in rates, which at the time were inching closer to 8%.
According to the MBA, the national median payment applied by purchase applicants increased to $2,199 in October from $2,155 from the month before. Meanwhile, those purchasing from builders saw payments jump to $2,672 in October from $2,640 in September, the MBA found.
“We’ve all tried to inform our clients that if they buy now they could benefit from concessions such as help with closing costs paid by the seller. We’ve also told them that should economic conditions unfold next year as predicted, they will be able to refinance their home loan. But the response we’re getting is just resistance from buyers,” Perezchica said.
“They say it is better to wait.”
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