Mortgage rates continue falling before Thanksgiving: Freddie Mac

The 30-year, fixed mortgage rate averaged 7.29% for the week ending Nov. 22, spurring an uptick in mortgage demand

Mortgage rates dropped significantly in the last few weeks, but the cost of borrowing remains high prompting many homebuyers to wait for even lower rates. 

The 30-year, fixed mortgage rate averaged 7.29% for the week ending Nov. 22, according to Freddie Mac‘s Primary Mortgage Market Survey. That’s down significantly from last week’s 7.44% and up from 6.58% the same week a year ago. 

HousingWire’s Mortgage Rates Center showed Optimal Blue’s average 30-year fixed rate on conventional loans at 7.283% on Wednesday.

“In recent weeks, rates have dropped by half a percent, but potential homebuyers continue to hold out for lower rates and more inventory,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “This dynamic is reflected in the latest data showing that existing home sales have fallen to a thirteen-year low.”

New construction starts and permits showed surprising strength in October while existing-home sales slumped to their worst reading since 2010.

Except for the last seven weeks, current mortgage rates hit their highest levels since 2000. As a result, rates have to fall further to spur more demand from homebuyers who are grappling with affordability pressures.

“If rates can hold onto this improvement, or notch a further decline, however, this could mean that ‘buying a home’ does seem like a viable new year’s resolution to a greater number of households,” Chief Economist Danielle Hale said in an emailed statement.

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