Page 19 - US Market Performance Report 1Q 2018

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The chart at the right shows that while the average 30-year xed rate mortgage is at its highest level since 3rd quarter 2013, Freddie Mac is bullish on the mortgage market, anticipating household formation among Millennials.
What they don’t address is the imbalance between demand and supply. Housing inventories are at abnormally low levels, the result of under building in the major markets.
This is creating price bubbles in the strongest employment markets. This is dropping affordability and becomes a major obstacle for the rst time homebuyer.
30-Year Fixed Rate Mortgage
Weekly Averages: Jan. 8, 2015 - July 5, 2018 SOURCE: FREDDIE MAC
Rate Points & Fees
%
5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5
0.0
2015
After a rapid
increase throughout most
2016
past six weeks.
The run-up in mortgage rates earlier this year represented not jut
2017
of the spring, mortgage rates have now declined in five of the
but for investors, the mortgage spread also rose back to more normal levels by about 20 basis points. What that means for buyers is good news. Mortgage rates may have a little more room to decline over the very short term.
Although the current economic expansion is in its 10th year, residential single-family real estate was initially slow to recover. Now, backed by the demographic tailwind provided by millennials reaching the
peak age to buy their -- Freddie Mac
first home, the housing market should have
a rise in risk-free borrowing costs,
some room to grow going forward.
2018
8-Jan-15 8-Apr-15 8-Jul-15 8-Oct-15 8-Jan-16 8-Apr-16 8-Jul-16 8-Oct-16 8-Jan-17 8-Apr-17 8-Jul-17 8-Oct-17 8-Jan-18 8-Apr-18 8-Jul-18 8-Oct-18
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