Instant Reaction: Mortgage Rates, August 29, 2024

Facts: The average 30-year fixed mortgage rate from Freddie Mac dropped to 6.35% this week from 6.46% last week. At 6.35%, with 20% down, a monthly mortgage payment on a home with a price of $400,000 is $1,991. With 10% down, the typical payment would be $2,240.

Positive: This is the lowest that mortgage interest rates have dropped in the past 15 months. This changes housing affordability for home buyers. For buyers who sought a mortgage at the recent high of 7.79% in October 2023, the payment would be $2,301. At 6.35%, this is a payment difference of $310 monthly or $3,720 a year. 

Negative: The question is: When are mortgage rates low enough for current homeowners to make a move? While the current rate helps first-time buyers, it might be a big shrug for repeat buyers, as they are locked into ultra-low-rate mortgages that we will not see again.