Home-Loan Roller Coaster Plunges To Historic Low 2.98%
Home-loan interest rates have plummeted to a historic record low of 2.98% nationwide—the lowest ever recorded by the Freddie Mac’s Primary Mortgage Market Survey, which dates back to 1971.
“Mortgage rates fell below 3% for the first time in 50 years,” said Sam Khater, Freddie Mac’s Chief Economist. The drop has led to soaring home-buyer demand, Khater observed.
“However, the countervailing force for the economy has been the rise in new virus cases which has caused the economic recovery to stagnate. This economic pause puts many temporary layoffs at risk of ossifying into permanent job losses.”
Average benchmark 30-year fixed-rate mortgages fell to 2.98% for the week ending July 16th, down from 3.03%. A year ago, the 30-year FRM averaged 3.81%.
Fifteen-year fixed loans averaged 2.48%, down from last 2.51% a week earlier. A year ago, 15-year fixed loans averaged 3.23%.
This means Chicago home buyers and families seeking to refinance now have a once-in-a-lifetime opportunity to lock in the lowest mortgage interest in five decades.
On July 17th Mutual of Omaha was quoting a rock bottom 3%, reported RateSeeker.com. Under an aggressive loan program involving pledged money-market funds, Huntington Bank, was quoting 2.325% on a seven-year jumbo adjustable-rate mortgage (ARM) with 25% down payment, according to mortgage broker Brian Bockholdt.
Before the recent sharp dip in interest charges, mortgage rates last reached a historical rock bottom on November 21, 2012, when the 30-year fixed mortgage average hit 3.31%, according to Freddie Mac’s archives.
North Side home-sales contracts surge
While overall closed home sales in June were down, there was a surge in sales contracts written but not yet closed, noted Mary Jo Nathan, who compiles the quarterly Chicago North Side Market Report for the Charese Team at Compass Roscoe Village.
“North Side contracts were up 14.4% in June compared to the same month last year, and the gains were extremely strong in three communities, Edgewater, North Center and Lake View, which all had increases of 30% or more."
The report tracks home sales in nine neighborhoods: Edgewater, Lake View, Lincoln Park, Lincoln Square, Near North Side, North Center, Rogers Park, Uptown and West Ridge.
Second quarter closed sales activity declined almost equally in the detached and attached segments of the North Side market. Detached sales were down 32.2% to 215 homes, while attached sales, mostly condominium apartments and townhouses, fell by 33.2% to 1,908 units.
However, the median price for the two categories moved in opposite directions. Sale prices of condos and townhomes rose 7.9% to $369,450, while median prices of detached single-family homes fell 9.7% to $935,000.
The average time it took a listing to go under contract increased only modestly during the second quarter across the North Side. Attached homes average 75 days, up eight days from a year earlier, while detached homes averaged 112 days, a six-day increase.