{"id":17976,"date":"2020-10-22T13:43:00","date_gmt":"2020-10-22T13:43:00","guid":{"rendered":"http:\/\/www.anthonydidonato.net\/wordpress\/?p=17976"},"modified":"2020-10-22T13:43:00","modified_gmt":"2020-10-22T13:43:00","slug":"are-low-mortgage-rates-to-blame-for-high-home-prices","status":"publish","type":"post","link":"https:\/\/www.anthonydidonato.net\/wordpress\/are-low-mortgage-rates-to-blame-for-high-home-prices\/","title":{"rendered":"Are Low Mortgage Rates to Blame for High Home Prices?"},"content":{"rendered":"

Are Low Mortgage Rates to Blame for High Home Prices?<\/h1>\n

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Double-digit price increases for homes are not exactly what most people in real estate predicted to occur in a recession. But could low mortgage rates\u2014the 30-year fixed-rate mortgage hit a record-low average of 2.81% last week\u2014be partially to blame?<\/p>\n

\u201cThe combination of what could be the lowest mortgage rates of our lifetimes, a paucity of inventory, and a desperate rush of buyers has resulted in median home list prices hitting new records,\u201d realtor.com\u00ae reports.<\/p>\n

Home prices were 12.2% higher for the week ending Oct. 10 than they were a year ago,\u00a0 realtor.com\u00ae data shows.<\/p>\n

“It’s unprecedented for us to get a massive run-up in home prices during a recession,” says Sam Khater, Freddie Mac’s chief economist. “It’s clear that [mortgage] rates matter even more than unemployment rates.\u201d<\/p>\n

Low mortgage rates are helping buyers afford higher home prices, and they\u2019re creating a buying frenzy in the housing market to lock in such low rates. Home buyers purchasing a median-priced home at about $350,000 still pay about $80 less than if they purchased a median-priced home of $315,000 last year at a higher interest rate average of 3.69%, a realtor.com\u00ae analysis shows.<\/p>\n

Affordability goes up with low mortgage rates. However, home buyers do need a higher down payment as prices rise.<\/p>\n

High home prices with high mortgage rates, on the other hand, is not a good combo, housing analysts point out. Ali Wolf, chief economist of Zonda, told realtor.com\u00ae that if mortgage rates go up by even a half-point, hundreds of thousands of buyers may no longer be able to purchase a home. First-time buyers, who tend to have smaller budgets, likely would experience the biggest repercussion.<\/p>\n

But many economists are predicting mortgage rates to stay low in 2021. In the meantime, home prices likely will remain elevated because buyer demand remains high and inventories remain stretched thin.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Source:<\/div>\n
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\u201cWhy Are Home Prices Rising So High? Blame Record-Low Mortgage Rates<\/a>,\u201d realtor.com\u00ae (Oct. 19, 2020)<\/div>\n
\u00a9National Association of REALTORS\u00ae
\nReprinted with permission<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Are Low Mortgage Rates to Blame for High Home Prices?   Double-digit price increases for homes are not exactly what most people in real estate predicted to occur in a recession. But could low mortgage rates\u2014the 30-year fixed-rate mortgage hit a record-low average of 2.81% last week\u2014be partially to blame? \u201cThe combination of what could … <\/p>\n

Continue reading<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,8],"tags":[5,32,4,9],"class_list":["post-17976","post","type-post","status-publish","format-standard","hentry","category-news","category-real-estate-tips","tag-anthony-didonato","tag-news","tag-real-estate","tag-tips","item-wrap"],"yoast_head":"\nAre Low Mortgage Rates to Blame for High Home Prices? - Real Estate Agent and Sales in PA - Anthony DiDonato Broomall, Media, Delaware County and surrounding areas in Pennsylvania<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.anthonydidonato.net\/wordpress\/are-low-mortgage-rates-to-blame-for-high-home-prices\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/are-low-mortgage-rates-to-blame-for-high-home-prices\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/are-low-mortgage-rates-to-blame-for-high-home-prices\\\/\"},\"author\":{\"name\":\"admin\",\"@id\":\"http:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/#\\\/schema\\\/person\\\/964792b6994e8cc4cbddc36ad4824908\"},\"headline\":\"Are Low Mortgage Rates to Blame for High Home Prices?\",\"datePublished\":\"2020-10-22T13:43:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/are-low-mortgage-rates-to-blame-for-high-home-prices\\\/\"},\"wordCount\":351,\"publisher\":{\"@id\":\"http:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/#\\\/schema\\\/person\\\/964792b6994e8cc4cbddc36ad4824908\"},\"keywords\":[\"Anthony DiDonato\",\"News\",\"Real Estate\",\"tips\"],\"articleSection\":[\"News\",\"Real Estate Tips\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/are-low-mortgage-rates-to-blame-for-high-home-prices\\\/\",\"url\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/are-low-mortgage-rates-to-blame-for-high-home-prices\\\/\",\"name\":\"Are Low Mortgage Rates to Blame for High Home Prices? 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