Mortgage Rates Hit New All-Time Lows—and They May Fall More

Mortgage interest rates have fallen to a new record low—and could continue to go down as the coronavirus pandemic continues to wreak havoc on the economy. The post Mortgage Rates Hit New All-Time Lows—and They May Fall More appeared first on Real Estate News & Insights |®.

Mortgage Rates Hit New All-Time Lows—and They May Fall More

There is at least one bright spot for home buyers, sellers, and owners amid the economic mayhem brought on by the novel coronavirus. Mortgage interest rates have fallen to a new record low, a boon to homeowners who may want to refinance and save money, and buyers (if anyone feels like buying a home right now).

Rates have been on a wild ride since this crisis began, and the average for a 30-year fixed-rate mortgage hit 3.23% for the week ending April 30, according to Freddie Mac. That’s the lowest it’s been since Freddie Mac began tracking rates in 1971. The average rate was 4.14% a year ago.

The drop may not seem all that substantial, as it’s not even a full percentage point. But the lower rate will save borrowers $132 a month for a $320,000 home (the national median home price) if they made a 20% down payment. That’s $1,584 a year—which adds up over the life of that 30-year loan.

Mortgage rates could continue falling as the pandemic continues wreaking havoc on the economy.

“Rates are not in a hurry to move back up from here,” says Matthew Graham, chief operating officer of Mortgage News Daily. “Unless there is a sudden and significant change in the global economy in response to a sudden and significant development in the fight against coronavirus, we likely haven’t seen the lowest rates yet.”

Those ultralow rates aren’t likely to save the slumping housing market, though.

“In a normal market, that would be great news for buyers,” says® Senior Economist George Ratiu. “In today’s market, rates are likely to have little impact.”

More than 30 million people are out of work as businesses across the nation have been forced to temporarily close to stem the spread of COVID-19. Even those that remain functioning have seen their revenue plunge, raising the prospect of more layoffs.

That should give both buyers and sellers pause. Add a severe shortage of properties for sale, with double-digit drops over the past few months, and it’s clear that this year’s spring home-buying season, already well underway, will end up far slower than usual.

Can borrowers snag these low rates?

Though rates have reached record lows, not everyone will be able to snag them. Mortgage rates can fluctuate throughout the day as well as vary quite a bit among lenders—by as much as 0.5%.

Riskier borrowers with lower credit scores, higher debt loads, or lost income due to the crisis may get stuck with higher rates, if they’re granted a loan at all.

“These rates are really available, but the catch is the restrictions are tighter at many lenders for things like lower credit scores … and other risk factors,” says Graham. “These either make for higher rates or flat-out unavailability, depending on the scenario.

Why rates are falling again

As the economy shifted into a downturn in early March, rates reached then-record lows of 3.29% in the week ending March 5. But just two weeks later, they had risen back to 3.65% despite the Federal Reserve slashing mortgage rates to between 0% and 0.25%. They’ve since fluctuated, sometimes multiple times a day.

They’re settling down again, thanks to changes the U.S. government has made to the secondary mortgage market. Lenders typically don’t want to keep a mortgage on their books once it’s made, as that ties up money that could be used to make new loans. So they sell the mortgages, which are bundled together into mortgage-backed securities, to investors in the secondary market.

With so many people out of work and unable to make their mortgage payments, many investors have shied away from these securities, also called mortgage bonds. But Fannie Mae and Freddie Mac are now permitted to buy these riskier loans in forbearance. That’s boosting investor confidence in these securities and driving up prices due to demand.

When mortgage bonds prices are up, mortgage rates go down. Hence, the lower rates.

“These low rates are driving higher refinance activity and have modestly helped improve purchase demand from their extremely low levels in mid-April,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “While many people are benefitting from low mortgage rates, it’s important to remember that not all people are able to take advantage of them given the current pandemic.”

The post Mortgage Rates Hit New All-Time Lows—and They May Fall More appeared first on Real Estate News & Insights |®.

Source : Realtor More   

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‘Timeless’ $40M Estate on Star Island Is the Week’s Most Expensive New Listing

With unparalleled views and a hard-to-beat location, a $40 million mansion on Florida's Star Island off Miami Beach shone as the most expensive new listing this week. The post ‘Timeless’ $40M Estate on Star Island Is the Week’s Most Expensive New Listing appeared first on Real Estate News & Insights |®.

‘Timeless’ $40M Estate on Star Island Is the Week’s Most Expensive New Listing

A contemporary waterfront estate on Florida’s ultra-exclusive Star Island has floated onto the market for $40 million. The top-tier price tag makes the Miami Beach property this week’s most expensive new listing on®.

The 14,762-square-foot luxury mansion on the guard-gated island last sold in 2011 for $25.5 million. At the time, it was one of the most expensive Miami Beach residential sales ever.

Post-purchase, the new owners remodeled and expanded the residence. According to the listing agent, Jill Eber with Coldwell Banker Realty, they added a professional chef’s kitchen, another bedroom, a home office, and a laundry facility.

The property is held by an opaque Delaware corporate entity (E&A Estates), and the elusive owners are now ready to sail away from the waterfront retreat, which comes with 100 feet of water frontage and a wood dock. Eber told us that the sellers live overseas and don’t spend as much time in Miami as they used to.

With the stand-out price comes a stand-out property.

“It’s the most sought-after view that you have in Miami. It’s direct bay, out to the downtown skyline,” Eber says.

She adds, “Everybody’s looking for the best of the best location. That is what this is. And then, the house itself is beautiful. It’s a trophy property.”

Biscayne Bay and Miami skyline views

Waterfront and dock

Covered seating area

Living room

Family room

Den with bar

Bedroom with sitting area


Along with those Biscayne Bay and Miami skyline views, the spacious spread contains 10 beds, 10.5 baths, a living room and formal dining room, a chef’s kitchen, library/den, wine room, and a great room that opens to the pool area. 

Upstairs, the master suite features a sitting room, office, and two large terraces, plus a bathroom with an onyx and glass steam shower, a walk-in closet, and custom spa tub. 

Other luxe interior details include stone floors, Venetian plaster walls, and an elevator.

On the almost 1-acre lot, the manicured grounds include a pool with a hot tub, cabana bath, covered bar, and multiple seating and sunning areas. 

“It’s really a timeless design,” Eber says. “The whole layout is open. It’s very much indoor-outdoor living.”

The current listing is at the top of the price point for the island, but it joins several other properties on the exclusive Miami Beach enclave that are up for grabs.

A renovated 1920s villa that came on the market in 2016 for $65 million dropped to $40 million last year. Each time it was listed, the estate was named our most expensive listing of the week. The property is still available.

In one more note, the singer Gloria Estefan has had a home on the market for years, first listed in 2015 for $40 million, now available for $32 million. She and her husband, Emilio Estefan, live nearby, and initially bought the place for Emilio’s mother. After her death, the couple rented out the property before deciding to sell it.

Considered one of the most sought-after locations in Miami, Star Island has attracted many A-listers to its shores, including Cher, Jennifer Lopez, and Ricky Martin.

The post ‘Timeless’ $40M Estate on Star Island Is the Week’s Most Expensive New Listing appeared first on Real Estate News & Insights |®.

Source : Realtor More   

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