Skip to main content

Mortgage Rates Up, Homes Selling Faster

Jun 14, 2018
After two weeks of decline, mortgage rates were on the rise again, according to new data from Freddie Mac

After two weeks of decline, mortgage rates were on the rise again, according to new data from Freddie Mac.
 
Sam Khater, Freddie Mac’s Chief Economist, saw a positive aspect to the increasing mortgage rates and with the yesterday’s decision by the Federal Reserve to raise the federal funds rate by 25 basis points.
 
“The good news is that the impact on consumer budgets will be smaller than past rate hike cycles,” Khater said. “That is because a much smaller segment of mortgage loans in today’s market are pegged to short-term rate movements. The adjustable rate mortgage (ARM) share of outstanding loans is a lot smaller now—eight percent versus 31 percent—than during the Fed’s last round of tightening between 2004 and 2006.”
After two weeks of decline, mortgage rates were on the rise again, according to new data from Freddie Mac
 
While rates continued to rise, homes continued to be sold at greater speed. A new report from Redfin found the typical home that sold in May went under contract in 34 days, breaking April's record of 36 days, which was the fastest month Redfin recorded since it began tracking the market in 2010. Also rising was the national median home sale price: $305,600, a 6.3 percent increase from May 2017 across the 174 markets that Redfin tracks.
 
During May, 27.6 percent sold above their list price, the highest percentage Redfin has recorded. But nearly one-quarter of homes for sale last month had a price drop, the highest percentage of price drops since September 2017.
 
"Prices are still increasing, but not at the same rate we saw earlier in the spring," said Redfin Senior Economist Taylor Marr. "The record percentage of homes sold above list price is at odds with the higher percentage of price drops in May. This tells us that while it's still very much a seller's market, price growth and rising mortgage rates may be pushing buyers to the limit of what they're able to pay."

 
About the author
Published
Jun 14, 2018
Co-Founder Mat Grella Terminated From NEXA

NEXA CEO Kortas states negotiations regarding the buyout will continue.

Mar 27, 2024
Comings And Goings At AmeriHome

Chief Operating Officer John Hedlund announced his retirement on Thursday in a LinkedIn post.

Mar 22, 2024
Rocket's Tim Birkmeier To Retire

Birkmeier is bidding farewell after a 28-year career at Rocket Companies.

Mar 21, 2024
How NAR’s Settlement Impacts Homebuying

While the settlement's silver lining is that homes are expected to become more affordable, many uncertainties loom over the housing market.

Mar 19, 2024
NAR Reaches $418 Million Settlement

The association agreed to give home sellers the option of compensating agents.

Mar 15, 2024
U.S. Non-Bank Mortgage Lenders Surge Amid Industry Consolidation, Fitch Ratings Reports

As smaller players exit the market, scaled originators like UWM and PennyMac Financial dominate, but challenges persist with low origination volume and pressured margins amidst rising interest rates.

Mar 14, 2024