Mortgage Interest Rates - St Louis Real Estate News

St Louis Home Loan Originations Fall to a 12-Year Low

By Dennis Norman, on March 2nd, 2023

During the 4th quarter of 2022, 7,622 home buyers in St Louis applied for a home mortgage according to the latest report from ATTOM Data. According to the report, this is the lowest number of mortgage applications in a quarter from home buyers in St Louis since the 1st quarter of 2011 when there were just 5,629 applications. Mortgage applications to purchase a home peaked in St Louis in the 3rd quarter of 2005 when there were 18,002 applications.

As the chart below illustrates, the drop in St Louis homeowners refinancing their mortgage is even more dramatic. During the last Continue Reading →

FHA Loans Just Became A Little More Affordable

By Dennis Norman, on February 22nd, 2023

Today, the U.S. Department of Housing and Urban Development (HUD) announced a reduction in the mortgage insurance premium charged to borrowers on FHA loans. The mortgage insurance premium is a charge over and above the interest on the loan that is the fee to HUD for insuring the loan. Currently, the FHA mortgage insurance premium varies from 0.45% to 1.05% of the loan amount depending upon the loan term (15 or 30 years) and the LTV (loan to value). Effective with FHA mortgages endorsed for insurance by FHA on or after March 20, 2023, the rate will be reduced by Continue Reading →

Mortgage Interest Rates Inch Up a Little After Dropping to 3-Month Low

By Dennis Norman, on December 20th, 2022

As the chart below illustrates, yesterday, mortgage interest rates on a 30-year fixed rate conventional mortgage increased slightly to 6.27% after dropping to 6.13% last Thursday, the lowest level in over 3 months.

Historically-speaking, it’s not that bad….

Granted, no one really wants to hear this, but, if we look at the bigger picture (like the bottom chart that goes back to 1971) we’ll see that our current mortgage interest rates aren’t that high. In fact, over the 52-year period depicted on the chart, about 70% of the time mortgage interest rates were higher than they are now. If you’re Continue Reading →

Mortgage Interest Rates Remain Lower For Two Weeks Now

By Dennis Norman, on November 25th, 2022

As the chart below illustrates, on November 10th, mortgage interest rates on a 30-year fixed rate mortgage dropped sharply from 7.22% the day before to 6.62% on the 10th. Since dropping, interest rates have remained around the 6.6% level.

Historically, the current rates are not bad, but that does lessen the impact…

As the bottom chart below shows, interest rates have been above the current levels for over half the period. However, understandably, that doesn’t mean much to first-time home buyers or younger homebuyers as for over the past 10 years the rates have been much less, even to the Continue Reading →

Fannie Mae Predicts Lower Home Sales and Home Prices Next Year

By Dennis Norman, on October 13th, 2022

Yesterday, Fannie Mae released their October housing forecast in which they forecast, among other things, where home sales and prices are headed. The report incudes a forecast for next year, which included:

Home prices in 2023 to decline 1.5% from 2022 Home sales to finish 2022 down nearly 18% from last year and drop another 22% in 2023 New home construction to end 2022 down 3.6% from last year and drop another 25% in 2023. Mortgage Interest Rates will continue to rise the rest of these year, ending the year at 6.7% and then will ease back to 6.4% in Continue Reading →

Why St Louis Home Prices Are Going To Decline

By Dennis Norman, on October 6th, 2022

A little over two weeks ago I wrote my most recent article addressing St Louis home prices titled “Will St Louis Home Prices Decline?” in which my short answer was “yes”, but kind of tongue in cheek and based upon the seasonality of home prices, but my longer answer was more vague. I mentioned that there certainly is a correction coming but pointed out that there are so many variables that will affect prices that it is hard to say to what extent this correction will be. While this is still true, a lot has happened in the short time Continue Reading →

Mortgage Interest Rates Top 7 Percent for first time in over 20 years

By Dennis Norman, on September 27th, 2022

Today, the interest rate for a 30-year fixed-rate mortgage hit 7.08% marking the first time in over 20-years the rate has gone above 7%. Historically speaking, as the 2nd chart shows, this is not that high of an interest rate and, in fact, lower than the median rate over the past 50 years, however, it’s a very high rate based upon the the recent past.

The affect of interest rates on home prices…

Interest rates just began increasing in the past few months, rising above the 4% level in February, so it will take time to see the impact of Continue Reading →

Will St Louis Home Prices Decline?

By Dennis Norman, on September 20th, 2022

The short answer is yes. They decline every year as we head into winter due to the seasonal nature of the business. If you look at the first chart below which depicts the median price of homes sold in the St Louis 5-County core market since 1998, you will notice a very consistent pattern of prices rising in the spring and summer, then declining in the fall and winter. For the most part, the other pattern you will see is that the peak each spring is higher than the spring before and the bottom each winter is higher than the Continue Reading →

Yesterday’s Headlines Say Interest Rates Are Below 5 Percent – Why They Were Wrong

By Dennis Norman, on August 5th, 2022

I saw dozens and dozens of headlines yesterday reporting that mortgage interest rates had fallen below 5% on a 30-year fixed rate mortgage. The catch is on the day that was reported, yesterday, interest rates were actually above 5% on a 30-year fixed-rate loan. As our chart below shows, the MND Rate index was reporting 5.09% and, below that, Optimalblue was reporting 5.326%. Both of the aforementioned charts are updated daily and considered by many in the industry to have the most current and accurate information.

How could all the big headlines be wrong?

Well, actually the articles I scanned Continue Reading →

Mortgage Interest Rates Ease Back to May Levels

By Dennis Norman, on July 22nd, 2022

Interest rates on a 30-year fixed-rate mortgage peaked at 6.28% a little over a month ago on June 14th, sending shockwaves through the St Louis housing market. After peaking however the rates have subsided, today dropping to 5.5%, the lowest rate since July 5th. This decline brings the mortgage rates down to the range they were I for most of May this year.

Search St Louis Homes For Sale Search St Louis Upcoming OPEN HOUSES Mortgage Interest Rates

(click on chart for live, interactive chart)

Search St Louis Homes For Sale Search St Louis Upcoming Continue Reading →

Showings Of St Louis Listings Fall To Levels Below January

By Dennis Norman, on July 6th, 2022

It’s no secret that the real estate market slows down in the winter and typically nearly screeches to a halt from shortly before Christmas to shortly after New Years. Therefore, when tracking showing activity in the St Louis area, the first week of January of each year is used as the base, or “0” value and then each rolling 7-day period afterward is compared to that first week.

As the chart below shows, in 2020 and 2021 all weekly averages of showing activity were above the baseline of January until getting close to Thanksgiving, with the one exception being late Continue Reading →

Mortgage Rates Fall Slightly to Lowest Level In Two Weeks

By Dennis Norman, on June 23rd, 2022

After hitting the highest rate in over 13 years just two weeks ago at 6.28%, as the chart below shows, mortgage interest rates on 30-year fixed mortgages declined today to 5.75%. The likelihood of interest staying under 6% is hard to to say at this time but I would say enjoy it while it lasts!

Search St Louis Homes For Sale Search St Louis Upcoming OPEN HOUSES Mortgage Interest Rates – 30 and 15-Year Conventional Loans, FHA Jumbo and and 5/1 ARM Loans Search St Louis Homes For Sale Search St Louis Upcoming OPEN HOUSES Continue Reading →

New Listings To New Contracts Ratio Increases This Month

By Dennis Norman, on June 16th, 2022

For the first three weeks of June there were 1,475 new listings of homes for sale in the St Louis 5-county core market, according to the STL Real Estate Trends Report from MORE, REALTORS®. During the same period, there were 1,194 new contracts written on homes for sale resulting in a new listing to new contract ratio of 1.25. This ratio of listings to new sales is higher than it was 3 weeks ago when I shared the last update from the STL Real Estate Trends report and it was 1.05 at that time for the period reported which was Continue Reading →

Will Home Prices Come Crashing Down?

By Dennis Norman, on June 15th, 2022

After over 40 years in the real estate business in St Louis I’ve seen many times just how fast a good, or even great housing market can turn sour as well as the other way around. Two years ago, economic conditions relevant to the housing market included:

Interest rates in the 3’s Inflation rate under 2% The money supply increasing at a historically normal rate A steady and robust St Louis housing market

Today, the above conditions are:

Interest rates in the 6.25% – 6.5% range with the threat of increasing Inflation rate approaching 9% The money supply increasing nearly Continue Reading →

Mortgage Rates Hit Highest Level In Over 13 Years

By Dennis Norman, on June 14th, 2022

The bond market had one of the worst days in history yesterday resulting in mortgage interest rates on a 30-year fixed rate mortgage hitting 6.0% and above. This is the highest rates have been since November 20, 2008 when the mortgage interest rates were 6.04%, according to Freddie Mac’s Primary Mortgage Market Survey®.

Is there a silver-lining to the higher interest rates?

Given that the reason for the higher interest rates has to do with our high inflation rates and declining economic conditions, it’s hard to find much positive to say about what is happening. Having said that, the one Continue Reading →

St Louis Home Saw Second-Largest Decrease In Home Loan Originations Of Metro Areas In The U.S.

By Dennis Norman, on June 9th, 2022

There were 2.71 million home loan originations during the first quarter of this year in the U.S., according to the U.S. Residential Property Mortgage Origination Report from ATTOM. This is an 18% decline from the prior quarter, the largest quarterly decline since 2017 and marks the fourth straight quarterly decline in loan originations according to the report.

Refinancing saw a bigger decline than home purchases…

During the first quarter of this year there were 1,446,622 loans originated that were refinances of existing mortgages which is a decline of 21.7% from the prior quarter. There were 1,011,975 loans originated for home Continue Reading →

Mortgage Interest Rates Fall For Third Consecutive Week (albeit slightly)

By Dennis Norman, on June 7th, 2022

On May 12th the 30-year fixed rate mortgage interest rate hit 5.3%, the highest rates since June 2009, according to Freddie Mac’s Primary Mortgage Market Survey®. As the chart below illustrates, mortgage interest rate have declined the last three consecutive weeks falling to 5.09% at the end of last week, the lowest rate since April 14th when the average interest rate was 5.0%.

Search St Louis Homes For Sale Search St Louis Upcoming OPEN HOUSES Mortgage Interest Rates – 30 and 15-Year Conventional Loans and 5/1 ARM Loan

(click on chart for live, interactive chart)

Continue Reading →

Mortgage Interest Rates Fall For Two Consecutive Weeks

By Dennis Norman, on May 27th, 2022

On May 12th the 30-year fixed rate mortgage interest rate hit 5.3%, the highest rates since June 2009, according to Freddie Mac’s Primary Mortgage Market Survey®. As the chart below illustrates, mortgage interest rate have declined the last two consecutive weeks falling to 5.10% yesterday, the lowest rate since April 28th.

There are more affordable options…

The chart I selected to show below also shows the mortgage interest rates for 15-year mortgages as well as something almost no one has had a reason to talk about for several years, adjustable rate mortgages (ARM’s). With mortgage interest rates as low as Continue Reading →

St Louis Home Sales Doing Well In Spite of Rising Interest Rates & Inflation

By Dennis Norman, on May 9th, 2022

There have been a lot of reports over the past month about rising interest rates (mortgage rates on a 30-year fixed-rate mortgage hit 5.27% last week) as well as rising inflation rates (8.5% in March) and the effect these things will have on the housing market. It’s no doubt they will have some affect on home prices and sales and I have been watching the data on St Louis home prices and sales closely and so far there does not appear to be much impact.

St Louis home sales increase in April from March…

There are two ways we analyze Continue Reading →

New Sales Last Week Declined Over Thirty Percent From The Week Before

By Dennis Norman, on April 29th, 2022

Last week there were 551 new contracts written for the sale of listings in the St Louis 5-county core market down over thirty-six percent (31.3%) from the week before when there were 802 new contracts written, according to the STL Real Estate Trends Report, exclusively available from MORE, REALTORS®. The new sales activity last week was down even more (nearly 36%) from the same week a year ago when there were 851 new contracts written on listings. There is no doubt this is the result of mortgage interest rates which have nearly doubled in the last 15 months.

New listings Continue Reading →

Inflation Rate Increases to 8.5 Percent in March…What will the effect be on home prices?

By Dennis Norman, on April 14th, 2022

This week it was announced that the U.S. inflation rate in March had increased to a staggering 8.5% the highest rate in over 40 years as illustrated by the chart below. The last time the inflation rate was higher than this was in December 1981 when it hit 8.9%. The “inflation rate” that I’m referring to, and is the most commonly reported, is based upon the Consumer Price Index for All Urban Consumers (CPI-U): U. S. city average. One of the categories included in the CPI-U is “shelter”. The report shows the shelter inflation rate at 5% which, on the Continue Reading →

Interest Rates Hit Highest Level in Over 2-Years

By Dennis Norman, on February 12th, 2022

Mortgage interest rates were at 3.69% for a 30-year fixed-rate loan as of this past Thursday, February 10, 2022., according to Freddie Mac’s Primary Mortgage Market Survey®. As the chart below illustrates, mortgage interest rates hit a low of 2.77% in August of 2021 and have pretty much been trending upward since.

Within the last few days, there have been a lot of reports in the media projecting mortgage interest rates to go higher this year. A lot of it is based on the current inflation rates which are not good so if the economy and rate of inflation improve, Continue Reading →

Typical St Louis Home Price Increased Nearly 11 Percent In Past Year – Payment On The Home Increased 25%

By Dennis Norman, on January 23rd, 2022

Most anyone that is interested in buying or selling a home is pretty much aware of two things: there is a low inventory of homes for sale and prices have increased a fair amount as a result. That part is likely largely a result of basic economics related to supply and demand. When the demand is greater than the supply, prices will increase. In St Louis, home prices have done just that. As the chart below (exclusively available from MORE, REALTORS®) illustrates, the median price of homes sold in January 2020 was $221, 200 and in January 2021 was $245,000, Continue Reading →

How Much Of An Impact Does Your FICO Score Have On The Cost Of A Home?

By Dennis Norman, on January 17th, 2022

Today, thanks to many apps and access to information, all consumers have ready and easy access to their FICO (credit) score. Anyone thinking of buying a home no doubt knows their credit score will come into play in terms of qualifying for a mortgage but just how significant is your credit score? Is there really that much difference between a 670 and 700 credit score, or between a 700 and 741 score? Well, when it comes to mortgage rates, it does make a difference!

A 670 FICO vs a 741 FICO will run up the typical cost of St Louis Continue Reading →

Mortgage-Interest Rates Hit Highest Level In Over a Year

By Dennis Norman, on January 16th, 2022

Mortgage interest rates were at 3.667% for a 30-year fixed-rate loan as of this past Thursday, January 13, 2022. As the chart below illustrates, after dipping slightly the week prior, the rates this most recent week hit the highest level in over a year.

Mortgage rates for an FHA mortgage also hit the highest level in over a year too with rates hitting 3.743%.

Search St Louis Homes For Sale Search St Louis Upcoming OPEN HOUSES Mortgage Interest Rates – 30 Years Conforming Conventional Loan -Past 12 Months

(click on chart for live, interactive chart and other Continue Reading →

Mortgage Rates Have Increased Significantly This Year

By Dennis Norman, on November 24th, 2021

As the charts below illustrate, at the beginning of this year, mortgage interest rates for a 30-year conforming conventional loan were at 2.771%, FHA loans were at 2.703%, and VA loans were at 2.372%. As of yesterday, those rates have increased to 3.357%, 3.468%, and 3.101% respectively.

While conforming 30-year conventional loans have seen an increase of 21% in rates (from 2.771% to 3.357%), FHA loans have seen an increase of 28% (from 2.703% to 3.468%) and VA loans have seen an increase of 30% (from 2.372% to 3.101%).

What does this mean in terms of the cost of a Continue Reading →

The House Payment on a Typical St Louis Home has increased just over 5% in 14 years

By Dennis Norman, on November 13th, 2021

Anyone paying even a little attention to the St Louis real estate market will likely be aware of the fact that we have been in a strong seller’s market for the past couple of years and St Louis home prices, as a result, have increased significantly. In fact, as the infographic below shows (exclusively available from MORE, REALTORS®) the median home price for a St Louis home has increased more than 50% in the past 14 years. However, the good news is that during that same period mortgage interest rates have fallen and remained low resulting an increase in the Continue Reading →

Have St Louis Home Prices Finally Increased Too Much?

By Dennis Norman, on October 31st, 2021

For the past few years now, we’ve experienced quite the seller’s market in St Louis fueled, in part, by a low supply of homes for sale. As a result, St Louis home prices have increased over the past few years at rates close to double the historic norm. Of late, we’ve heard a lot from people within, and outside of, the real estate industry expressing concern that home prices have gotten too high and even some have made comparisons to 2008 when the housing market saw the bubble burst. Being the data nerd I am, I’ve tried to keep emotion Continue Reading →

Mortgage Interest Rates Hit Highest Level In Six Months

By Dennis Norman, on October 23rd, 2021

Mortgage interest rates were at 2.65% for a 30-year fixed-rate loan at the beginning of this year, according to Freddie Mac’s Primary Mortgage Market Survey® and rose through the late winter months and started the spring housing season with rates hitting 3.18% on April 1st. This rate was the highest rate since June, 2020 when rates hit 3.21% and was the highest level for interest rates in 2021. This past week, according to the same market survey, the 30 -year fixed-rate mortgage interest rate hit 3.09%, the highest level in six-months, but still below the peak rate for the year Continue Reading →

Mortgage Interest Rates Decline After Peaking In Spring

By Dennis Norman, on July 29th, 2021

Mortgage interest rates dropped peaked in the spring of this year with the rate on a 30-year fixed rate conventional loan hitting 3.353% in mid-March then staying near that range until mid-April when rates started to ease. In mid-June the rate had crept back up to 3.229% but last week dipped below 3% to 2.982%. As of yesterday, the rate has increased slightly but is still just a tad over 3% (3.019%).

Mortgage Interest Rates – 30 Years Conforming Conventional Loan -Past 12 Month Period

(click on chart for live, interactive chart and other loan types)

Search Continue Reading →