MCLEAN, Va. - Freddie Mac (OTCQB: FMCC (OTC:FMCC)) reported on Thursday a decrease in the 30-year fixed-rate mortgage, which now averages 6.08 percent, marking the lowest level in two years. This marginal decline from the previous week's average of 6.09 percent reflects a trend that has been observed in the mortgage market recently.
In contrast, the 15-year fixed-rate mortgage (FRM) experienced a slight increase, averaging 5.16 percent, up from 5.15 percent last week. Comparing year-over-year data, the current rates for both 30-year and 15-year FRMs show a significant drop from the respective averages of 7.31 percent and 6.72 percent.
The Primary Mortgage Market Survey® (PMMS®), which tracks these figures, focuses on conventional, conforming, fully amortizing home purchase loans for borrowers with a 20 percent down payment and excellent credit.
Sam Khater, Freddie Mac’s Chief Economist, noted the downward trajectory of rates, which has led to a resurgence in refinancing activity. Homeowners are finding opportunities to reduce their monthly mortgage payments through refinancing. Prospective homebuyers, on the other hand, appear to be adopting a cautious approach, waiting to see if rates will fall further as new economic data emerges in the coming weeks.
Freddie Mac, a public government-sponsored enterprise, has been a cornerstone of the housing market since 1970, promoting liquidity, stability, affordability, and equity across various economic cycles. The organization's efforts have assisted tens of millions of families in purchasing, renting, or retaining their homes.
This report is based on a press release statement and reflects the latest available data regarding U.S. mortgage rates as of September 26, 2024.
In other recent news, Freddie Mac announced a series of fluctuations in the U.S. 30-year fixed-rate mortgage. The rate has reached its lowest point since May 2023, averaging 6.46%, a slight decrease from the previous week's average of 6.49%. Despite the decline in mortgage rates, potential homebuyer interest has not significantly increased, according to Freddie Mac's Chief Economist.
The National Association of Realtors (NAR) reported a 1.3% rise in existing home sales in July, ending a four-month streak of declines. However, the pace of home sales remains sluggish, according to Lawrence Yun, NAR's chief economist.
Freddie Mac's chief economist has stated that the downward trend in rates is expected to continue through the end of the year, influenced by a softening of incoming economic data. Despite some positive indicators, consumer confidence remains tentative, and affordability issues continue to be a significant concern for homebuyers. These are recent developments that potential investors should take into consideration.
InvestingPro Insights
As Freddie Mac (OTCQB: FMCC) continues to influence the housing market with its latest report on mortgage rates, investors and market observers are keeping a close eye on the company's financial health and stock performance. According to recent data from InvestingPro, Freddie Mac's market capitalization stands at $3.83 billion, reflecting its significant presence in the financial services industry. Despite not paying dividends, the company has shown a remarkable one-year price total return of 98.37%, underscoring its high return over the last year and its status as a prominent player in the sector.
An InvestingPro Tip worth noting is that analysts predict Freddie Mac will be profitable this year, which aligns with the company's expected net income growth. This is particularly relevant as the company navigates the changing dynamics of the mortgage market, with fluctuating interest rates impacting refinancing activity and home purchases. Additionally, the company's stock price movements have been quite volatile, with a six-month price total return of -29.17%, highlighting the potential risks and rewards for investors.
For those seeking more in-depth analysis, there are additional InvestingPro Tips available, which delve into aspects such as the company's liquidity position, with liquid assets exceeding short-term obligations, and its overall profitability metrics. By visiting https://www.investing.com/pro/FMCC, readers can access a comprehensive set of insights that can help them make more informed investment decisions.
Freddie Mac's role in the mortgage market is undeniably impactful. As the company navigates through economic changes and prepares for its next earnings report on October 30, 2024, staying informed with the latest data and expert insights from InvestingPro can provide a competitive edge to those monitoring this sector.
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