Attention home and condominium shoppers and homeowners who were planning to refinance old high-rate loans. If you failed to take advantage of several years of record low mortgage rates, the days of bargain-basement home-loan deals apparently are over.
Benchmark 30-year fixed mortgage interest rates climbed to an average of 4.58% on April 26th—the highest level in more than four years, reported Freddie Mac’s Primary Mortgage Market Survey.
“Mortgage rates are now at their highest level since August 22, 2013,” noted Sam Khater, Freddie Mac chief economist. “Higher Treasury yields, driven by rising commodity prices, more Treasury issuances and the steady stream of solid economic news, are behind the uptick in rates.”
Mortgage rates hit a historical rock bottom on November 21, 2012, when the 30-year fixed mortgage average hit 3.31%, Freddie Mac reported.
A week ago, the nation’s lenders were charging an average of 4.47% for a 30-year mortgage. It was the third consecutive week home-rates increased, climbing 11 basis points to 4.58 percent.
In late March, the Federal Reserve Board raised the federal funds interest rate by a quarter of 1 percentage point to a range of 1.5% to $1.75%—its highest level since 2008.
On April 27th in Chicago, 30-year loans generally were available in a range of 4.486% to 4.61%, reported rateSeeker.com. A year ago at this time, the 30-year fixed loans averaged 4.03% nationwide.
Fifteen-year fixed loans rose to an average of 4.02%, up from 3.94% a week earlier. A year ago at this time, the 15-year fixed mortgages averaged 3.27%.
“Despite the increase in borrowing costs, demand for home purchase credit remains solid,” Khater said. “The Mortgage Bankers Association reported in its latest mortgage applications survey that activity was up 11 percent from a year ago.”
Chicago home and condo prices rise
Meanwhile, the median price of existing single-family homes and condominiums in Chicago in March rose 6.4% to $314,000, up from $295,000 in March of 2017, reported Illinois Realtors. Only 2,290 homes and condos were sold in March, a decline of 10.1% from 2,546 units in March of 2017.
“Limited supply and high demand took center stage for the start of the Chicago spring housing market,” noted Rebecca Thomson, president of the Chicago Association of Realtors.
“While the number of closed sales slowed in tandem with the inventory crunch, the rise in median sales price and reduction of the average time it took for a home to sell, points to competition for well-priced homes in good condition,” Thomson said.
A total of 8,848 single-family homes and condos were sold in March in the nine-county Chicago metropolitan area, down 10.2% from 9,849 units in March of 2017. The median price in March was $241,000 in the Chicago area, an increase of 4.8% from $230,000 in March of 2017. Median price is where half the homes sold for more and half sold for less.
Statewide, 12,455 homes and condos were sold in March, down 7.9% from 13,528 in March of 2017. The statewide median price in March was $199,000, up 4.8% from March of 2017, when the median price was $189,900.
Homes and condos selling faster
The time it took to sell a single-family home or condo statewide in March averaged just 65 days, down from 68 days a year ago. Available housing inventory totaled 48,834 homes and condos for sale, a 12.6% decline from March of 2017 when there were 55,863 units on the market.
Sales and price information are generated by Multiple Listing Service closed sales reported by 27 participating Illinois Realtor local boards and associations including data from Midwest Real Estate Data, LLC.
“Statewide sales numbers saw declines as buyers poised to enter the spring housing market were confronted with the reality that inventories dropped by double-digit percentages,” said Matt Difanis, president of Illinois Realtors. “With demand still strong as evidenced by decreases in the time it takes on average to sell a home, the next few months could be marked by intense competition by potential home buyers.”
University of Illinois economist Geoffrey J.D. Hewings noted that the Fannie Mae Home Purchase Sentiment Index rose. “The national index is driven primarily by a sizable increase in the net share of consumers who think it’s a good time to buy a home,” Hewings said.
For more housing news, visit www.dondebat.biz. Don DeBat is co-author of “Escaping Condo Jail,” the ultimate survival guide for condominium living. Visit www.escapingcondojail.com.