Since they fell dramatically in May, mortgage rates have been making the headlines, not least when the average 30 year fixed rate recently went below the psychological barrier, for many buyers, of 4%.
In fact rates have generally been falling steadily since their November 2018 peak of 4.87% for the average 30 year fixed home loan.
Inevitably, this has led to a very busy summer homes market, as buyers scramble to lock in a very low rate while they still can.
And, make no mistake, this is a very rare opportunity if we look back over recent history.
Below is a list, going back in five year increments, of average 30 year fixed rates since 1971, according to Freddie Mac:
May 2014 – 4.19%
May 2009 – 4.86%
May 2004 – 6.27%
May 1999 – 7.15%
May 1994 – 8.60%
May 1989 – 10.77%
May 1984 – 13.94%
May 1979 – 10.69%
May 1974 – 8.97%
Even last November’s peak 2018 rate looks good compared with most of these examples.
The average annual 30 year fixed rate has only been at 4% in five years out of the past 48!
During this time, the highest ever monthly 30 year fixed average was an astounding 18.45% in October of 1981.
So it really is a great time for buyers to be buying and sellers to be selling in an atmosphere of excellent buyer sentiment.
Of course the unanswerable question at the moment is which direction rates will go from here. In recent days there has been a slight uptick, but they are still positioned at below 4% for a 30 year fixed rate home loan. At the same time, there has been speculation that they could go even lower.
As always in a situation like this, the only certainty is to take the view that the current very positive mortgage interest rate levels represent an opportunity that history proves doesn’t come around too often.
Please don’t hesitate to contact us at The Hyland/Schneider Team at 928-445-2100 to discuss any aspect of the current situation.