Mortgage interest rates falling at start of spring housing market
Loop North News

The Home Front

As mortgage interest rates continue to fall, now is the perfect time for prospective home buyers to get off the fence and dive into the spring house-hunting market, experts say.

31-Mar-19 – Freddie Mac’s Primary Mortgage Market Survey reported that benchmark 30-year fixed-rate mortgages plummeted to an averaged 4.06 percent for the week ending March 28, down from 4.28 percent a week earlier.

The 22 basis-point decline was the biggest one-week drop in a decade, Freddie Mac noted. On January 3, the average 30-year loan rate was 4.51 percent. Last year at this time, the 30-year fixed loans averaged 4.40 percent.

Chicago-area lenders were charging a range of 4.234 to 4.318 percent on 30-year fixed-rate mortgages on March 29, reported RateSeeker.

Fifteen-year fixed mortgages declined 14 basis points to an averaged 3.57 percent on March 28, down from 3.71 percent a week earlier. On January 3, the average 15-year loan rate was 3.99 percent. A year ago, 15-year loans averaged 3.90 percent.

Sam Khater

“The Federal Reserve’s concern about the prospects for slowing economic growth caused investor jitters to drive down mortgage rates by the largest amount in more than ten years,” said Sam Khater (left), Freddie Mac’s chief economist. “Mortgage rates have dipped quite dramatically since the start of the year and house prices continue to moderate, which should help on the home buyer affordability front.”

“The combination of improving affordability and more inventory than the last few spring selling seasons should lead to improved home sales demand,” said Khater.

Realtors agreed the existing housing market in Chicago is being stimulated by the long-term trend of lower mortgage rates.

“As we enter the spring market, buyers on the hunt are eager to take advantage of lower interest rates and are serious once they find their desired home,” observed Tommy Choi (right), president of Chicago Association of Realtors and broker at Keller Williams Chicago - Lincoln Park.

Tommy Choi

Chicago home prices rise

Illinois Realtors reported that the median price of a home in Chicago in February was $273,900, inching up 0.7 percent from $272,000 in February 2018. However, the city saw year-over-year existing home sales decrease 7.4 percent with 1,422 units changing hands in February, compared with 1,535 units a year ago, reported Illinois Realtors.

“February’s data is in line with what we have come to expect as our market shifts,” said Choi. “Even though closed sales are down, median sales prices ticked up and both inventory and days-on-market declined.”

In the nine-county Chicago Metro Area, single-family home and condominiums sales in February totaled 5,607 units, down four percent from February 2018 sales of 5,839 homes. The median price in February was $230,000 in the Chicago Metro Area, an increase of 1.1 percent from $227,500 in February 2018.

Sales and price information was generated by Multiple Listing Service closed sales reported by 27 participating Illinois Realtor local boards and associations including Midwest Real Estate Data.

Statewide, 8,174 homes and condos were sold in February, down 1.8 percent from 8,327 units in February 2018. The statewide median price in February was $187,000, up 1.1 percent from February 2018, when the median price was $185,000. The median is a typical market price where half the homes sold for more and half sold for less.

Ed Neaves

“Home sales were lower in February, but median prices are still recording steady growth in the state,” said Ed Neaves (left), Illinois Realtors president-elect. “What’s notable is that the time it takes to sell a home is down three days, a market indicator which shows consumers want to buy, but may struggle to find enough options from which to choose.”

The time it took to sell a home in February averaged 68 days, down from 71 days a year ago.

Available home inventory statewide totaled 47,711 units for sale, a three percent decline from 49,193 units in February 2018.

“Housing prices continue their slow but steady increase,” said Geoffrey J.D. Hewings (right), a University of Illinois economist. “However, year-over-year sales exhibit negative trends for the next three months although month-to-month changes are forecast to be very positive.”

Geoffrey J.D. Hewings

By Don DeBat | Loop North News | debatnet@aol.com

Published 31-Mar-19 1:39 AM

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