Over the past several weeks, Federal Home Loan Mortgage Corporation has reported the typical 30-year fixed mortgage rate dropping to record lows, all the way down to 3.03%. Last week’s reported rate reached rock bottom within the history of the survey, which dates back to 1971.
What does this mean for buyers?
This is huge for homebuyers. Those currently taking advantage of the increasing affordability that comes with historically low-interest rates are winning big, consistent with Sam Khater, Chief Economist at Freddie Mac:
“The summer is heating up as record-low mortgage rates still spur homebuyer demand.”
In addition, Realtor.com notes:
“Summer home buying season is off to a roaring start. As buyers flooded into the market, realtor.com® monthly traffic hit an all-time high of 86 million unique users in June 2020, breaking May’s record of 85 million unique users. Realtor.com® daily traffic also hit its highest level ever of seven million unique users on June 25, signaling that despite the worldwide pandemic buyers are able to make a sale .”
A lower monthly payment means savings which will add up significantly over the lifetime of a loan. It also means qualified buyers could purchase more house for their money. That could mean a bigger home than what they’d have been able to buy at a higher rate. Not a bad trade-off considering the amount of time people are spending at home these days amidst the pandemic.
If you’re in a position to shop for a home this year, it’s an excellent time to reach out to a local real estate agent to begin the process while mortgage rates are historically low.