According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates were relatively flat last week, remaining near recent lows despite a slight increase across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. Mike Fratantoni, MBA’s senior vice president and chief economist, says rates moved higher but so has purchase demand. “Mortgage rates were up modestly, with the 30-year mortgage rate increasing slightly … With this move, refinance application volume declined on the week but remains almost three-times as high as last year’s pace†Fratantoni said. “The news for the week was that more home buyers appear to be entering the market. Purchase application activity was up for the week and increased more than 9 percent compared to last year at this time.†The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

Before closing on a house, it’s important to find out as much about it as you can. That’s why scheduling an inspection is typically among the first things buyers do after having their offer accepted. A buyer has to be sure the house is structurally sound and has no major issues. But while you can know a lot about a home’s structure and mechanical systems before committing to it, you can’t always know what the neighbors are like and how well you’ll get along with them – and sometimes that can be just as important as the structure and mechanical systems. A majority of Americans say good neighbors are a priority. In fact, according to one recent survey, a majority of Americans rate their prospective neighbors as a “high†or “very high†priority when choosing a place to live. The survey found 60 percent said living in a neighborly community with close-knit connections was important to them. Why are neighbors so important? Well, the survey found 65 percent of respondents said they feel they can count on their neighbors for help when needed. (source)

New home sales numbers are known to be volatile on a month-to-month basis. They’re also frequently revised. That’s certainly the case with the latest numbers from the U.S. Census Bureau and the Department of Housing and Urban Development. Their latest New Residential Sales report shows the previous three months’ sales numbers were revised higher after their initial release. That means sales were better than reported. It also means the market for newly built single-family homes is on good footing and should see further gains as mortgage rates continue to improve. And while the month-over-month data shows sales down 4.7 percent in August from July, a look at the numbers from last year shows sales were almost 10 percent higher than August 2023. Additionally, the median price of new homes has fallen 4.6 percent over the past 12 months. (source)

The National Association of Realtors’ Pending Home Sales Index tracks the number of contracts to buy homes signed each month. The index is considered a good future indicator of home sales numbers since signings take place near the beginning of the home buying process and final sales numbers are based on closed transactions, which typically happen weeks later. That means the NAR’s latest release showing contract signings increasing is a good sign sales numbers are about to head higher too. In August, contract signings were up 0.6 percent from the month before. Lawrence Yun, NAR’s chief economist, says the improvement is due to mortgage rates. “A slight upward turn reflects a modest improvement in housing affordability, primarily because mortgage rates descended … in August,†Yun said. “However, contract signings remain near cyclical lows even as home prices keep marching to new record highs.†The Midwest and West saw the biggest improvements in August, while the South was relatively flat and the Northeast declined month-over-month. (source)

For years now, buying a home has been getting more expensive. Higher home prices and climbing mortgage rates have had affordability trending in the wrong direction. But lately, things have started to change. In fact, according to ATTOM Data Solutions’ third-quarter 2024 U.S. Home Affordability Report, buying a home was more affordable during the third quarter. Rob Barber, ATTOM’s CEO, says market challenges remain but conditions are starting to head in the right direction. “Home affordability continues to show signs of easing, which lightens the pressure on house hunters struggling to find a place that fits their budget,†Barber said. “The cost of owning a home across much of the nation remains a tough go for average workers, exceeding levels preferred by banks and other lenders. But it is at least tracking in the right direction. That’s mainly because of declining interest rates.†(source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell again last week. Rates were down from the week before for 30-year fixed-rate loans with conforming balances and loans backed by the Federal Housing Administration. It was the eighth-straight week of declines. Joel Kan, MBA’s vice president and deputy chief economist, says demand for loan applications jumped to a two-year high as a result. “Mortgage applications increased to their highest level since July 2022, boosted by a 20 percent increase in refinance applications after a large increase the prior week,†Kan said. Refinance activity is now 175 percent higher than it was at the same time last year. Purchase demand, on the other hand, is just 2 percent higher year-over-year, after a 1 percent increase last week. The MBA’s survey has been conducted weekly since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

Falling mortgage rates have created a buzz among potential buyers but rates aren’t the only market factor trending in the right direction. According to the latest release from the S&P Case-Shiller Home Price Indices, home price increases are also offering buyers a bit of a break. The numbers show prices – while still climbing – are doing so at an ever-slower pace. In fact, the numbers show the National Home Price Index up 5 percent year-over-year through the end of July, down from a 5.5 percent increase the previous month. As always, where you’re looking to buy will determine just how quickly prices are moving. “Regionally, the Northeast remains the best performing market, with New York the top performer for three months running, followed by the Midwest region,†Brian D. Luke, S&P’s CFA, says about where prices are climbing fastest. “The South reported the slowest gains regionally but includes five of the seven best performing markets since 2020.†(source)

Every month, Fannie Mae’s Economic and Strategic Research Group releases a commentary covering what the group sees ahead for the housing market and economy. Its forecast looks at factors like mortgage rates, home prices and economic growth, then estimates where they’re headed through the end of the year and into the next. In its September release, the group says mortgage rates have improved considerably but have yet to move home buyers, who may be holding out for even better conditions. “Although mortgage rates have fallen considerably in recent weeks, we’ve not seen evidence of a corresponding increase in loan application activity, nor has there been an improvement in consumer home buying sentiment,†Doug Duncan, Fannie Mae’s senior vice president and chief economist, says. “We think it’s likely that many would-be borrowers are waiting for affordability to improve even further, and that some may be anticipating additional declines in mortgage rates given expectations that the Fed will lower the federal funds target rate.†(source)

After five consecutive monthly declines, construction of new, single-family homes spiked in August, according to new numbers from the U.S. Census Bureau and the Department of Housing and Urban Development. The spike included a 15.8 percent increase in single-family housing starts – which measure the number of new homes that began construction during the month. It also included a 2.8 percent increase in permits to build new homes. The gains come at a time when other housing indicators are improving and could be a sign that builders are seeing more traffic now that conditions have eased in favor of home buyers. They may have also been influenced by a homebuilding rebound in the South, after Hurricane Beryl temporarily disrupted activity in July. Whatever the case, a rising number of new homes under construction is encouraging, as it helps balance the market and keeps home prices steady. (source)

Buying a home isn’t something you do in an afternoon. It takes several weeks, maybe months. That could explain why, despite news of improved buying conditions, the latest home sales numbers from the National Association of Realtors show sales dropping 2.5 percent in August. Why would sales be slowing at the same time conditions are getting better for buyers? Well, because August numbers reflect the closed sales of buyers who began shopping for a house many weeks earlier, while buyers motivated by falling rates in August will close sales in the weeks ahead. Lawrence Yun, NAR’s chief economist, says sales should move higher in coming months. “Home sales were disappointing again in August, but the recent development of lower mortgage rates coupled with increasing inventory is a powerful combination that will provide the environment for sales to move higher in future months,†Yun said. Mortgage rates have now been falling for most of the past two months and the number of available homes for sale – according to the NAR – is up 22.7 percent from last year at the same time. That’s good news for both fall home buyers and future sales numbers. (source)