Mortgage rates decreased slightly this week, falling from 6.69% to 6.6% for a 30-year fixed home loan, according to Freddie Mac. The decline is the third consecutive week, with Freddie Mac’s chief economist Sam Khater attributing it to declining mortgage rates and the passage of time.
However, with the end of the year approaching, many buyers and sellers are focusing on what will happen in the 2025 market. Realtor.com economist Jiayi Xu expects housing inventory to gradually improve as declining rates and time help mitigate the lock-in effect on existing homeowners.
The outlook for mortgage rates in 2025 is uncertain, with rates expected to average around 6.3% across the year, according to a recent forecast. However, if mortgage rates were to fall closer to 6%, it could be a bumpy road due to market conditions.
In other news, home prices ticked down by 1.2% year-over-year for the week ending Dec. 7. While this marks the 28th consecutive week of decline in median listing price, the size of homes has increased, which accounts for some of the decrease. The national median home listing price per square foot actually rose by 1.5%.
Housing stock is on the rise, with 23.5% more homes for sale than a year ago. However, growth was slowest since March, and the pace of new listings suggests a cautious environment where sellers are holding back.
The average home spent eight days more on the market this week compared to last year, marking a record-breaking 24 consecutive weeks of homes spending at least five days longer on the market than they did last year. This slowdown is attributed to buyers taking their time due to plenty of inventory and few financially attractive prospects.
Source: https://www.realtor.com/news/real-estate-news/mortgage-rates-december-12