The lower the rate, the more purchasing power buyers have.
The median price of a home sold in May rose 3.6% from a year earlier, according to Redfin. That is the largest gain in seven months.
watch now
A report from CoreLogic showed prices up 3.6% in April annually, the first annual increase since March 2018.
“The pickup in sales between March and April, has helped to counter the recent slowing in annual home-price growth,” said Frank Nothaft, chief economist at CoreLogic. “Mortgage rates are 0.6 percentage points below what they were one year ago and incomes are up, which has improved affordability for buyers. However, price growth has remained the highest for lower-priced homes, constraining housing choices for first-time buyers.”
And that is the double-edged sword for most homebuyers today. The average rate on the 30-year fixed has fallen from just over 5% last November to about 3.86% today, according to Mortgage News Daily, providing a sizable savings on a monthly payment. But while buyers may get a break there, the supply of lower-priced homes for sale is still incredibly low.
The reasons for the supply constraint are manifold. Homebuilders are still not putting up as many entry-level homes as are needed because the costs of land, labor and materials are just too high. There were 404,000 job openings in the construction sector in April, the highest since the Great Recession, according to the National Association of Home Builders.
In addition, the existing supply of entry-level homes was eaten into significantly by investors during the housing crisis. Millions of homes that went to foreclosure are now part of a new asset class of institutional investor-owned rental portfolios.
watch now
Lower interest rates therefore mean even more competition for entry-level buyers. On the higher end, homes are more plentiful, but demand is far lower.
“In May, inventory posted its smallest increase in eight months, and fewer new listings came on the market than last year,” said Fairweather. “Low rates and rising prices will likely lure sellers onto the market this summer, but the lack of new construction will continue to hold back sales growth.”
“Marketers always ask me how to make more or better content and it’s almost always the wrong question. The right question is: How do I get my content in front of the right people.”
Joe Chernov – Visit The Online Publishers “TOP” for content placement services.
How to come up with a successful ad?!.
The Best Platform For Social Media Influencers.
Sell personal photos online. To more click Theinternationalcampaigner.
3 Reasons To Get TOP For Press Release Distribution Help.
3 Services on Influencers Marketing Platform TOP That Let You Make Money.
How Should Governments Go Seeking Out Investors For Foreign Direct Investment?.
3 Ways TOP Platform Can Help You With Online Lobbying.
TOP Enables Photographers To Earn More Money From Home.
Find A Large Ebooks Library With TOP Platform.
You Need TOP Online Reputation Building Today For These 3 Reasons.
How To Get Fast Google Reviews Online.
1 Effective Way TOP Helps Advertisers Today.
3 Reasons To Start Getting Online Reviews With TOP Today.
3 Steps To Making More Money Online With Translating Through TOP.
3 Ways Advertisers Make Money With TOP.
content publishing and digital marketing.
Yves Saint Laurent: The Last Collections review – shocking portrait of a fashion legend.
How & Where to Gamble When Travelling in the Middle East.
Hiccups in a newborn could mean their brains are developing say researchers.
Prada will host its Resort 2021 fashion show in Japan.
How to find out if you’re eligible for Italian citizenship by descent.
