Higher Mortgage Rates Slow Pending Home Sales in June
Pending home sales for the month of June slowed as higher mortgage rates hindered buyers' demand. Fixed conforming mortgage rates on 30 year and 15 year loans increased more than 1.00 percent the past several months. The sharpest increased occurred in mid-June when 30 year rates increased from an average of 4.00 percent to 4.50 percent in just one week, the highest weekly increase in average rates ever.
Pending Home Sales Slow
Slowing pending home sales isn't a surprise since mortgage rates have increased so dramatically in such a short period of time. The National Association of REALTORS® reported The Pending Home Sales Index, a forward-looking indicator based on contract signings, fell 0.4 percent to 110.9 in June 2013.
June's number is down from 111.3 in May 2013, but still 10.9 percent higher than in June a year ago. Pending home sales for the month of May reached the highest point in over six years, just prior to the increase in mortgage interest rates which started in June. July's pending home sales number will be lower than June as mortgage rates haven't retreated much from the recent highs.
Home Prices Surge in May 2013
Along with current mortgage rates moving higher, home prices have also moved sharply higher the past year. The Standard & Poor’s/Case-Shiller 20-city home price index increased 12.2 percent in May. The increase in home prices was across the United States with the biggest increases in West and Southwest of the country.
The largest increase in home prices was in San Francisco at 24.5%, the second largest increase was in Las Vegas 23.3% and the third largest increase was in Phoenix at 20.6%. The slowest increase in prices was on the East Coast with New York showing a 3.3% gain, Cleveland showing a 3.4% gain and Washington DC a6.5% gain.
Current Mortgage Rates
Mortgage rates today on 30 year conventional mortgage loans are averaging 4.35 percent, up from the prior day's average 30 year mortgage rate of 4.33 percent. In the spring of 2013, average 30 year rates were about 1.00 percent lower. You can't find lenders quoting 30 year rates as low as 3.50 percent but there are still some lenders quoting 30 year rates at 3.875 percent if you're willing to pay points.
Today's mortgage rates on 15 year conventional loans are averaging 3.43 percent, a slight increase from yesterday's average 15 year interest rate of 3.42 percent. Back in May of 2013, average 15 year rates were around 2.50 percent and we probably won't ever see average 15 year rates that low again. There are, however, still some lenders quoting 15 year refinance rates as low as 2.875 percent with points.
Current mortgage rates on 30 year jumbo loans are averaging 4.69 percent, up from Wednesday's average 30 year jumbo mortgage rate of 4.67 percent. Jumbo mortgage rates never fell as much as conforming rates but they haven't increased as much the past month either. The lowest jumbo mortgage rates quoted on RatesORama were around 3.50 percent back in May. Currently, the lowest 30 year jumbo rates are quoted at 4.25 percent.
Average 15 year jumbo mortgage rates are at 4.03 percent, up from an average 15 year jumbo rate of 3.99 percent. The best jumbo rates on 15 year loans in our database right now are 50 basis points below the average. If you're willing to pay points to buy down the mortgage rate, you can find lenders on RatesORama.com with rates as low as 3.50 percent.
5 year adjustable mortgage rates on conforming loans are averaging 3.40 percent, a slight decrease from an average 5 year adjustable rate of 3.41 percent. The lowest 5 year adjustable mortgage quotes in our rate database are at 2.50 percent with points. Just over three months ago, we had lenders quoting 5 year rates as low as 1.75 percent but a rate of 2.50 percent is still very low, historically speaking.
5 year adjustable jumbo mortgage interest rates are averaging 3.20 percent, up from an average 5 year jumbo rate of 3.19 percent. It is interesting that average 5 year jumbo rates are 20 basis points lower than 5 year conforming rates. The best jumbo rates on 5 year loans right now on RateORama can be found as low as 2.875 percent with points.
RatesORama.com Average Mortgage Rates