Connect with us

Hi, what are you looking for?


As home sellers and buyers wait on a Fed cut, here’s how mortgage rates have affected the spring housing market

People looking to buy or sell a home this spring are paying close attention to mortgage rates.

The average 30-year, fixed-rate mortgage rose to 7.17% for the week ended April 25, according to Freddie Mac data via the Federal Reserve. The rate was 7.10% the prior week.

Buyers and sellers may not see any relief soon.

It remains unclear when the Fed might make its first rate cut. Experts anticipate policymakers will continue to hold rates steady in this week’s meeting and will trim borrowing costs in the second half of the year.

“I believe our first rate cut is penciled in for July,” said Matthew Walsh, assistant director and economist at Moody’s Analytics.

Until then, average mortgage rates might continue to bounce around between 6.5 to 7.5%, Walsh said.

“We might not see rates fall in any meaningful way until [the] later half of this year,” he said.

Rates will keep ‘buyers and sellers on their toes’

“The biggest thing when we’re looking at mortgage rates right now is volatility,” said Nicole Bachaud, a senior economist at Zillow Group.

While some buyers have come to terms with 7% interest rates, the volatility of rates is “really the thing that’s going to impact the [housing] market the most,” Bachaud said.

When rates bounce around from week to week, a buyer looking into a house one day might not be able to afford the same property the next day, she said.

The swinging movement of rates is “going to keep buyers and sellers on their toes for longer than expected,” Bachaud explained.

For example, a homebuyer hoping to secure a $400,000, 30-year fixed-rate mortgage might have gotten a rate of about 6.82% in early April, according to Freddie Mac and Fed data. That works out to a monthly mortgage payment of around $2,613. Two weeks later, rates were hovering at 7.10%. That slightly higher rate adds $75 to the monthly mortgage payment, or $27,000 over the life of the loan.

Even a 1 percentage point difference may not sound like much, but it can mean almost $200 more on a monthly mortgage payment, said Jacob Channel, a senior economist at LendingTree.

Would-be buyers are paying attention to the math. For the week ended April 19, the mortgage application demand dropped 2.7% compared with a week earlier, as average 30-year fixed-rate mortgages jumped from 7.13% to 7.24%, according to recent data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.

“The spring housing market this year is somewhat getting back to normal,” Bachaud said.

Some areas are experiencing more sales with buyers getting used to the higher rates and looking for ways to make it work, she said.

Even so, more sales are expected to happen at the end of May and early June, she said.

That’s also when sellers tend to get the best prices. To that point, in 2023, homes listed in the first two weeks of June sold for 2.3% more, a $7,700 boost on a typical U.S. home, according to an earlier Zillow analysis.

“I’d say we’d probably also see a later spring season this year,” Bachaud said.

This post appeared first on NBC NEWS

Enter Your Information Below To Receive Free Trading Ideas, Latest News And Articles.

    Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

    You May Also Like


    Leading chip designer Advanced Micro Devices, Inc. (AMD) is at a critical juncture, one which could go either way depending on the dynamics of...


    Meta Platforms Inc. (META), the social media giant formerly known as Facebook, has been in tight consolidation at the top of its range for...

    Editor's Pick

    There is no trial in recent history, or possibly all of American history, that can rival the one underway in Lower Manhattan. For the...


    Output from the top uranium-producing countries rose steadily for a decade, peaking at 63,207 metric tons (MT) in 2016. However, global uranium production has...

    Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024