Boston luxury condos for sale and mortgage rates
Boston Luxury Condo Search
Boston luxury condos for sale and mortgage rates
MBA: Mortgage applications rise 7.4% despite increased rates
Mortgage applications rose 7.4% in the week ended March 3 despite a continued rebound in mortgage rates, which rose the highest level since November 2022, the Mortgage Bankers Association said, citing its Weekly Mortgage Applications Survey.
The average contract interest rate for conforming 30-year mortgages of $726,200 or less jumped to 6.79% from 6.71% the week before, while the rate for 30-year fixed-rate mortgages backed by the FHA climbed to 6.56% from 6.45%.
At the same time, MBA’s refinance index rose 9% from the week before, as the refinance share of mortgage activity increased to 28.9% of mortgage applications from 28.7% in the preceding week.
“Even with higher rates, there was an uptick in applications last week, but this was in comparison to two weeks of declines to very low levels, including a holiday week,” MBA Vice President and Deputy Chief Economist Joel Kan said in a news release. “Comparing the application indices from a year ago, purchase applications were still down 42%, and refinance activity was down 76%. Many borrowers are waiting on the sidelines for rates to come back down.”
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances of more than $726,200 increased to 6.49% from 6.44%, and the average contract interest rate for a 15-year fixed-rate mortgage increased to 6.25% from 6.13%.
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After rising steadily for three weeks, mortgage rates dipped slightly last week, prompting a small increase in refinance activity. Activity from homebuyers, however, pulled back further, leaving total mortgage demand basically flat from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased to 5.84% from 5.98%, with points decreasing to 0.64 from 0.77, including the origination fee, for loans with a 20% down payment.
Mortgage demand to purchase a home increased 0.1% for the week after rising more solidly the previous week. It was, however, 24% lower year over year.
“Overall purchase activity has weakened in recent months due to the quick jump in mortgage rates, high home prices, and growing economic uncertainty,” said Joel Kan, an MBA economist. “The average purchase loan amount declined to $413,500, which highlights an ongoing downward trend seen since it hit a record $460,000 in March 2022.”
The drop in the loan size is likely the result of moderating price growth due to higher mortgage rates and buyers not being able to borrow as much at those higher rates.
After that brief drop, mortgage interest rates popped back up at the end of last week and continued this week, according to another read from Mortgage News Daily. The average rate on the 30-year fixed is now approaching 6% again.
Boston luxury condos for sale and mortgage rates
Boston Luxury Condo Search
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Whether you are a buyer searching for your first Boston luxury condo, or a homeowner looking to move up to your next home, you should pay attention to where mortgage interest rates are heading.
Over the course of 2018, according to Freddie Mac’s Primary Mortgage Market Survey, rates have increased from 3.95% in the first week of January to 4.40% in the first week of April.
At first glance, the difference between these numbers in such a short amount of time could be concerning, but if we look at the graph below, we’ll see that rates have already started to level off and return to the mark set in February.
Boston luxury condos for sale
This is great news for anyone looking to buy a home this spring! The spring is always one of the busiest seasons for home buying, and with rates increasing even more, buyers have come off the fence to lock in great rates! This is still great advice as the experts believe that rates will continue to rise throughout the year.
Every month, Freddie Mac, Fannie Mae, the Mortgage Bankers Association and the National Association of Realtors release their projections for where they believe mortgage rates will be in the coming months. If we take the average of what each of the four organizations is predicting for the second quarter, rates are expected to rise to about 4.48% by June.
That average climbs to 4.73% by the end of this year.
So, what does this mean?
Waiting until the end of the year to buy, with rates still projected to increase, will end up costing you more money on your monthly mortgage payment. For every $250,000 you need to borrow to purchase your dream home, you will spend $49.21 more per month, $590.52 per year, and over $17,700 by the end of your 30-year mortgage.
And that’s just the impact of your interest rate going up!
Bottom Line
If you are ready and willing to purchase a home, find out if you’re able to. Let’s get together to evaluate your needs and help you with next steps!