Newsmakers and Quotables
Mortgage rates Fall to a Record Low for the 10th Time this Year (Bloomberg Oct 15) The average rate for a 30 year fixed rate loan dropped to 2.81%, down from 2.87% last week, and the lowest in almost 50 years of data-keeping, Freddie Mac said. It was the 10th record low this year. The previous record—2.86%--held for about a month.
Record-High Lumber Costs Drive Up New-Home Prices (NAHB Oct 14) Shoppers seeking newly constructed homes are facing sharply increased prices as the cost of lumber has soared to record highs. Many buyers are finding themselves priced out of the new-home market, builders say. Recent lumber price spikes have added more than $16,000 to the typical cost of a new, single-family home. Average lumber prices have increased by more than 170% since mid-April.
Threats to First-Time Home Buyers’ Path to Ownership (Forbes Oct 9) Higher home prices are translating into higher down payments. “Higher home price mean higher down payments, and first-time buyers may suddenly realize it is a challenge unless they can tap into financial help from family members,” says Lawrence Yun, NAR’s chief economist. Also, lenders are requiring higher credit scores as default risks for existing homeowners mount amid the pandemic. The median FICO score for purchase mortgages is around 700, according to the Urban Institute’s July 2020 data.
