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Home / Business / Mortgage rates drop to an annual low and set the stage for a sunny spring season

Mortgage rates drop to an annual low and set the stage for a sunny spring season





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A woman looks at real estate listings in a broker window. Mortgage lending rates have fallen to their lowest level in more than a year as investors continue to worry about the economic headwind and prop up the real estate market for a strong spring season.

The 30-year fixed-rate mortgage averaged 4.35% for the week ended February 21

, mortgage lender Freddie Mac said Thursday. This was a decline of 4.37% in the previous week and the lowest since the beginning of February 2018. The popular product only increased once a week in 2019.

The 15-year variable rate mortgage averaged 3.78%, which equates to a decrease of three underlying points. The five-year Treasury indexed variable rate hybrid mortgage averaged 3.88%, compared to 3.84%.

These rates do not include fees for obtaining mortgage loans.

Mortgage rates range from 10 US Treasury Notes

TMUBMUSD10Y, + 1.90%

even though the mortgage market sometimes takes a few days to catch up in the bond market.

See also: The average variable rate mortgage is nearly $ 700,000. That tells us.

Yields on rising-rate bonds are trapped in "cross-flows," according to Federal Reserve President Jerome Powell. The delayed trade talks between the US and China have helped to increase the attractiveness of assets considered safe havens. Recently, yields have declined as US Federal Reserve officials have increasingly argued for a slowdown in the pace of bond reductions in their balance sheets.

Nevertheless, investors are keeping a watchful eye on the supply of new government bonds in the market. The massive deficits created by tax cuts in 2017 and spending increases are being fueled by more bond issues, and oversupply could undermine demand and pricing power.

At the moment, however, there are more purchases than Treasury sales – good news for borrowers. (Here's a look at how mortgage applications are rising in comparison to last month with falling interest rates.)

Even if mortgage rates are subdued, there is a lot of headwinds against potential home buyers. Debt Consolidator Freedom Financial's Freedom Debt Relief subsidiary recently conducted a survey on consumer attitudes to debt and the economy.

Respondents indicated that their combined debts – student loans, credit card deposits, medical debt and more – were among the big factors that kept them from buying a home. This applies to 26% of Generation X members, 36% of Millennials, and 35% of Generation Y players born in 1995.

Recalling the economic forces that oppose consumers, respondents of all ages said affordable health care was their highest priority, followed by wage growth. After these two considerations, respondents named affordable housing in third place.

Read: Market correction or medium-term speed threshold? Real estate agents say about the real estate market


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