Freddie Mac, the government-sponsored mortgage giant, has released the results of its Primary Mortgage Market Survey® (PMMS®), revealing that the 30-year fixed-rate mortgage (FRM) averaged 6.28 percent as of April 6, 2023. This marks a decline from last week when it averaged 6.32 percent, and a significant increase from a year ago when the 30-year FRM averaged 4.72 percent.

Sam Khater, Freddie Mac’s Chief Economist, noted that mortgage rates are continuing to trend down as the traditional spring homebuying season begins. However, he also highlighted the challenges faced by potential homebuyers, particularly first-time homebuyers, due to the low inventory of homes for sale in the market.

According to Lawrence Yun, Chief Economist of the National Association of Realtors (NAR), the decline in mortgage rates over the past four weeks is a positive development for homebuyers. Compared to the recent peak of 7% average rate, the current rate of 6.28% can save a homebuyer $140 per month on a $300,000 loan.

Yun also pointed out that the fallout from regional bank collapses has led to tightening lending conditions in some areas, but residential mortgages, including VA, FHA, and conforming mortgages, continue to have government guarantees, which ensure a steady appetite for these loans.

The longer-term prospect on mortgage rates is also positive, with the possibility of rates going under 6% by the end of the year. Yun attributed this to the steady supply of new apartments hitting the market, which will limit rent growth and overall consumer price inflation, leading to the Federal Reserve potentially stopping its tightening policy. Lower rates are expected to attract more homebuyers, but it is crucial to ensure an increase in housing supply to meet the recovering demand.

Overall, the declining trend in mortgage rates is good news for potential homebuyers, but challenges such as low inventory and tightening lending conditions remain. It will be important to monitor how these factors evolve in the coming months and their impact on the housing market.

Some Highlights

• If you’re thinking about buying a home, be sure to plan for closing costs.
• Closing costs are typically 2% to 5% of the total purchase price of a home, and they can include things like government recording costs, appraisal fees, and more.
• Let’s connect so I can answer your questions about the homebuying process.

 Freddie Mac today released the results of its Primary Mortgage Market Survey (PMMS) for the week ending March 30, 2023, showing the 30-year fixed-rate mortgage (FRM) averaged 6.32 percent.

“Economic uncertainty continues to bring mortgage rates down,” said Sam Khater, Freddie Mac’s Chief Economist. “Over the last several weeks, declining rates have brought borrowers back to the market but, as the spring homebuying season gets underway, low inventory remains a key challenge for prospective buyers.”

• 30-year fixed-rate mortgage averaged 6.32 percent as of March 30, 2023, down from last week when it averaged 6.42 percent. A year ago at this time, the 30-year FRM averaged 4.67 percent.
• 15-year fixed-rate mortgage averaged 5.56 percent, down from last week when it averaged 5.68 percent. A year ago at this time, the 15-year FRM averaged 3.83 percent.

The PMMS is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20 percent down and have excellent credit.