Loan rates in the United States dropped to their lowest level in six month, easing the housing affordability crisis.
The average for a 30-year, fixed loan was 6.73 %, down from 6.78 % last week, Freddie Mac said in a statement Thursday.
After a difficult few weeks for the sales industry, the rate drop from over 7 % earlier this year has fueled homebuyer need. Contracts to purchase formerly owned properties, which are generally a key sign of income, increased for the first time in three weeks from near-record highs in June.
There is a chance that this will help. Chair Jerome Powell gave the impression that the central banks might begin cutting costs as soon as September while the Federal Reserve held its standard rate slow at its meeting on Wednesday.
Since consumers are still dealing with rising house prices and a dwindling source of listings, the effects of a rate decrease on the housing market could be more accurately quantified.
The market is anticipating a Fed price cut, which is supported by signs of cooling inflation, but concerns about customer confidence may stop an immediate increase given the urgency of value issues, according to Sam Khater, the chief economist at Freddie Mac.
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