May 08, 2019
Early 2019 Showed Signs of Mortgage Rate Stability—But Only Briefly
The mortgage rates offered by lenders displayed a relatively steady range at the start of 2019, with some ups and some downs, but no shocking dips or rises; but going into the spring buying season there has been some volatility.
According to analysis by Bankrate, mortgage rates—which went through some fairly stark reactions to news from the Federal Reserve over the course of 2018—managed to remain fairly steady in the last month of that year, and in January managed to remain stable, basically matching rates seen in Spring of 2018 (before the minor whiplash caused in the sector by Fed activity, to which some attribute a portion of the falloff in buyer interest during the latter portion of last year).
Despite this relative stability of lower rates coming into 2019, buyers remained somewhat wary in January, leaving home purchases around 500,000 lower in number in January than seen in Spring 2018 despite the roughly analogous rates. Chances are this was influenced by the nearly 5 percent rates on 30-year fixed-rate mortgages seen in November; closings do take some time after all, when done traditionally.
Through February, the rates fell week over week, by the 21st averaging 4.35 for a 30-year fixed loan, apparently setting up a good spring selling season—particularly for starter-home buyers. But in the meantime the rates have begun to rise again, reaching 4.54 by February 28th and 4.64 by March 7th. This has caused a predictable decrease in mortgage applications week-over-week. Purchase applications dipped around 3 percent over the course of the week, and refinances fell 2 percent in the same time period. So rather than new home buyers, the market has again shifted to favor those moving up and those whose incomes are on the higher-end of the market.
Nonetheless, despite all of these minutiae, the fact is that rates remain historically low. Any rate-raising activity by the Fed over the course of this year—which of course is always on the table—would certainly push rates higher. Starter home buyers at present may have to set their sights on less house than they could have afforded last spring, but there is always the opportunity to move up once equity has begun to build; and it is hardly worth risking being able to afford even less house should rates jump in 2019.
At any rate, no matter what the financial situation of a buyer, title defects can occur with any property. We at Topouzis & Associates, P.C. are experts at ferreting out these defects and disposing with them in advance of closing. We take pride in the great amount and quality of experience we bring to the closing table in Rhode Island, Massachusetts, and Florida. Contact us if you want a partner in your property closing—one who makes everyone involved feel like family.