The 30-year fixed-rate mortgage (FRM) changed course again this week, averaging 5.13%, down from 5.22%, according to the latest Primary Mortgage Market Survey® (PMMS®) released by Freddie Mac today.
Key highlights:
- 30-year fixed-rate mortgage averaged 5.13% with an average 0.8 point as of August 18, 2022, down from last week when it averaged 5.22%. A year ago at this time, the 30-year FRM averaged 2.86%.
- 15-year fixed-rate mortgage averaged 4.55% with an average 0.7 point, down from last week when it averaged 4.59%. A year ago at this time, the 15-year FRM averaged 2.16%.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.39% with an average 0.3 point, down from last week when it averaged 4.43%. A year ago at this time, the 5-year ARM averaged 2.43%.
What the experts are saying:
“Inflation appears to be beyond its peak, which has stopped the rapid increase in mortgage rates that the housing market was experiencing earlier this year,” said Sam Khater, Freddie Mac’s chief economist. “The market continues to absorb the cumulative impact of the large price and rate increases that led to a plunge in affordability. As a result, over the rest of the year purchase demand likely will continue to drag, supply will modestly increase, and home price growth will decelerate.”
Realtor.com Manager of Economic Research, George Ratiu, commented:
“The Freddie Mac fixed rate for a 30-year loan reversed last week’s bounce, sliding to 5.13%. Mortgage rates are mirroring the zigzag movement of the 10-year Treasury, as capital markets react to the positive economic numbers, while under the shadow of two quarters of negative GDP growth. July’s retail sales data showed resilient consumer spending, despite the highest inflation seen in four decades. The insights round out a spate of recent indicators which highlight a steady economy amid recession concerns. With gas prices taking a noticeable step back last month, there are expectations that inflation may slowly abate in the second half of the year.
“In addition, moderating home price and rent growth may further contribute to a slowdown in consumer prices. For real estate markets, late summer spotlights a tentative transition toward a post-pandemic normal. Based on realtor.com®’s weekly data, many homeowners are pulling back from selling their homes, concerned about missing the pricing peak, especially as the share of listed homes with price reductions gains ground. After picking up in the last couple of months, new listings are retreating, slowing the rebalancing process. However, the shift toward a calmer market continues, highlighted by the further moderation in price gains which made a noticeable move toward single-digit territory last week,” Ratiu concluded.
