Rates Ease For Third Straight Week

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According to a report from the National Association of Realtors This Week in Real Estate, existing home sales declined by 1.9% in April compared to both the previous month and the same period last year. However, the median sale price of existing homes reached a record high of $407,600, reflecting a year-over-year increase of 5.7%. Additionally, mortgage rates decreased for the third consecutive week, with the 30-year fixed-rate mortgage averaging 6.94% – the lowest level since early April. Notably, the U.S. Department of Veterans Affairs (VA) plans to issue a circular before June 12, temporarily lifting its ban on buyers directly paying for professional real estate representation. During this period, VA buyers will be able to directly compensate their agent. Below are a few newsworthy events from the third week of May that influence our business:  
EXISTING-HOME SALES RETREATED 1.9% IN APRIL. Existing-home sales faded 1.9% in April to a seasonally adjusted annual rate of 4.14 million. Sales also dipped 1.9% from one year ago. The median existing-home sales price grew 5.7% from April 2023 to $407,600 – the tenth consecutive month of year-over-year price gains and the highest price ever for the month of April. The inventory of unsold existing homes climbed 9% from one month ago to 1.21 million at the end of April, or the equivalent of 3.5 months’ supply at the current monthly sales pace. Read the full story here.
LONG-TERM MORTGAGE RATES EASE FOR THIRD STRAIGHT WEEK, DIPPING JUST BELOW 7%. The average rate on a 30-year mortgage dipped this week to just below 7% for the first time since mid-April. The rate fell to 6.94% from 7.02% last week, mortgage buyer Freddie Mac said Thursday. This is the third straight weekly decline in the average rate. The recent pullbacks follow a five-week string of increases that pushed the average rate to its highest level since November 30. After climbing to a 23-year high of 7.79% in October, the average rate on a 30-year mortgage stayed below 7% this year until last month. This month’s pullback in mortgage rates has spurred a pickup in home loan applications, which rose last week by 1.9% from a week earlier, according to the Mortgage Bankers Association. “May has been a better month for the mortgage market, with the last three weeks showing declining mortgage rates and increasing applications,” said MBA CEO Bob Broeksmit. Read the full story here.
VA TO ROLL OUT TEMPORARY FIX TO BUYER AGENT COMMISSION PROBLEM. The United States Department of Veterans Affairs will soon release a circular that “bridges the gap” on an agency law that prohibits a VA buyer from paying their real estate agent compensation, a VA official announced on Tuesday. VA policy states that while a veteran is allowed to use a buyer broker to purchase a home using their VA loan benefit, they “may not under any circumstances, be charged a brokerage fee or commission in connection with the services of such individuals.” In a letter to the VA, the MBA stressed that veteran borrowers will be disadvantaged if they lack the ability to compensate real estate agents. “While the market’s response to the settlement remains uncertain, one thing is clear: Veteran borrowers will be significantly affected by this ruling,” the letter stated.  In a statement issued on Tuesday, the MBA said that it welcomes this move from the VA. Read the full story here.

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