Mortgage rates are on a continuing streak of record lows. For the fourteenth time this year, the 30-year fixed-rate mortgage averaged its lowest on record: 2.71%, Freddie Mac reports. The previous record low of 2.72% was set just last month.
Could home buyers be starting to take the low rates for granted?
“Despite persistently low mortgage rates, home sales have hit a wall,” says Sam Khater, Freddie Mac’s chief economist. “While home buyer appetite remains robust, the scarce inventory has effectively put a limit on how much higher sales can increase. Unfortunately, the record low supply combined with strong demand means home prices are rapidly escalating and eroding the benefits of the low mortgage rate environment.”
Freddie Mac reports the following national averages with mortgage rates for the week ending Dec. 3:
- 30-year fixed-rate mortgages: averaged 2.71%, with an average 0.7 points, falling from last week’s 2.72% average. Last year at this time, 30-year rates averaged 3.68%.
- 15-year fixed-rate mortgages: averaged 2.26%, with an average 0.6 points, dropping from last week’s 2.28% average. A year ago, 15-year rates averaged 3.14%.
- 5-year hybrid adjustable-rate mortgages: averaged 2.86%, with an average 0.3 points, dropping from last week’s 3.16% average. A year ago, 5-year ARMs averaged 3.39%.
Freddie Mac reports average commitment rates along with average points to better reflect the total upfront cost of obtaining the mortgage.
Source: Freddie Mac and “Instant Reaction: Mortgage Rates, December 3, 2020,” National Association of REALTORS® Economists’ Outlook blog (Dec. 3, 2020)
