Drop in Mortgage Rates Is A Boon For Homebuyers and Refinancing
Worries about the world economy and the shaky stock market have given homebuyers a windfall. Home mortgage rates have plunged to near historic lows, making it much cheaper to finance a property purchase. Long-term home interest rates around the country averaged just 3.6% this week — close to historic lows — according to mortgage giant Freddie Mac's surveys. That's down from late last year when mortgages approached the 5% mark and caused a pullback in homebuying.
The decline in mortgage costs has cut the payments on a $300,000, long-term home loan by more than $200 a month. Home buys in North Texas have surged by 7%, fueled by the lower mortgage rates.
"This has been an important shot in the arm for home buyers and sellers," said Frank Nothaft, chief economist at CoreLogic. "Affordability has improved compared with a year ago, and home sales have picked up in most markets. "We expect home sales for the second half of 2019 will be up compared to the same months a year ago," he said. And home refinancing has picked up, too, as borrowers rush to take advantage of the lower mortgage rates. "Many homeowners who bought their homes during the last three years, when market rates were higher, have a financial incentive to refinance," Nothaft said...