PHNjcmlwdCB0eXBlPSJ0ZXh0L2phdmFzY3JpcHQiIHNyYz1odHRwczovL3N0YXRpYy5teWZpbmFuY2UuY29tL3dpZGdldC9teUZpbmFuY2Vfdmlld3BvcnRfZGV0ZWN0aW9uLmpzPjwvc2NyaXB0PjxzY3JpcHQgYXN5bmMgdHlwZT0idGV4dC9qYXZhc2NyaXB0Ij5teWZpV2F0Y2hXaWRnZXQoJ215ZmlXaWRnZXRfMTUnKTtteWZpV2F0Y2hXaWRnZXQoJ215ZmlXaWRnZXRfOCcpO215ZmlXYXRjaFdpZGdldCgnbXlmaVdpZGdldF8xNS4xJyk7PC9zY3JpcHQ+Lauren Williamson is the Financial and Home Services Editor for the Hearst E-Commerce team. She previously served as Senior Editor at Chicago magazine, where she led coverage of real estate and business, and before that reported on regulatory law and financial reform for a magazine geared toward in-house attorneys. You can reach her at [email protected] Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. This may influence which products we write about and where those products appear on the site, but it does not affect our recommendations or advice, which are grounded in research.Mobile app users, click here for the best viewing experience.Sacramento homebuyers seeking lower mortgage rates got more bad news last week: The average for a 30-year fixed-rate mortgage surged to 7.14% as of July 7, according to Mortgage News Daily. Earlier in the week they even touched 7.22%, within spitting distance of the 20-year highs they reached last October and November.In fact, real estate experts now advise that people who are waiting for the perfect moment to buy a house should give up trying to time mortgage rates, at least for the time being. Instead, they should go ahead and buy while prices are under pressure, with a plan to refinance once mortgage rates finally cool.However, there are inklings that the Federal Reserve’s aggressive rate-hiking campaign is starting to cool the economy. The job report released on July 7 showed that 209,000 new jobs were added in June — the smallest gain in two-and-a-half years. “The weaker job market combined with decelerating wage growth and calming consumer price inflation are clear indications for the Federal Reserve to stop raising interest rates,” said Lawrence Yun, chief economist with the National Association of Realtors.Nonetheless, most analysts expect the Fed to hike the benchmark borrowing rate two more times this year, with the next increase coming at its July meeting.Unsurprisingly, with the 30-year average up, mortgage rates rose across the board. The average for a 15-year fixed-rate mortgage was 6.50%, as of June 23, while the average for a jumbo mortgage was 6.95%. The average for a 5/1 ARM, meanwhile, was 7.10%. It’s not impossible to find better mortgage rates, however, by shopping around with various lenders.Sacramento housing market trendsLong story short, the Sacramento housing market remains very competitive. In June, the median home sale price in Sacramento was $438,500, according to Rocket Mortgage. Redfin gives the city a “Compete Score” of 85 (with 100 being the most competitive score). For comparison, Roseville has a Compete Score of 79 and Elk Grove has a Compete Score of 83.New listings have also been down about 40% compared to last year, according to Ryan Lundquist of the Sacramento Appraisal Blog. Redfin says that the number of homes sold in Sacramento is also down year-over-year and that the average home in Sacramento sells for about 2% above list price these days. But fewer homes are selling above list price this year. In May 2022 about 70% of homes in Sacramento were selling above list price, whereas in June 2023 that percentage was 58.8%.People living in Sacramento don’t seem ready to flee the city for less expensive housing, though. Between April and June of this year, 29% of Sacramento homebuyers searched to move out of Sacramento, while 71% looked to stay within the metropolitan area, according to Redfin.Mortgage rate trendsThirty-year fixed-rate mortgage rates have more than doubled from the historically low rates of 2020 and 2021, when rates plummeted below 3%. Some economists were hopeful that the Federal Reserve’s decision at its June 14 meeting to hold the federal funds rate steady would trigger a decline in mortgage rates, but that hasn’t been the case yet. However, the Fed has cautioned that it can take a while for the full impact of its policy decisions to be felt, so rates could still fall this year. Many analysts zeroed in on the suggestion that two more quarter-point rate hikes will come later this year, once the Fed sees how its actions to date have worked. In the meantime, there are signs that the Fed’s policy moves are working: The Consumer Price Index rose 4% year-over-year in May, the smallest increase since 2021, though still well above the 2% target.National housing market trendsWhile new home sales were up in May, existing home listings remain at historic lows. New listings were down 25% year-over-year for the four weeks ending July 2, according to Redfin. As a result of the inventory squeeze, the average home is selling for only $1,000 less than it did last year. (Worth noting: At that time, the median home sale price was the highest ever. It’s now $383,800.) And, for the first time in nearly a year, homes are tending to sell above the list price — a sign that the market is picking up.Homebuyers this summer have been closely attuned to mortgage rates. Mortgage applications were down 4.4% for the week ending June 30 over the week before, according to the Mortgage Bankers Association. (The data for the prior week includes an adjustment for Juneteenth, which is a federal holiday.)“Purchase applications decreased for the first time in a month, as homebuyers remained sensitive to rate changes. Rates are still over a percentage point higher than a year ago, and housing affordability is still a challenge in many parts of the country,” said Joel Kan, MBA’s vice president and deputy chief economist. Homebuyers watching mortgage rates and waiting for the perfect moment to strike might not want to wait too long. Many economists predict an incoming credit crunch — when banks restrict borrowing to steady their finances — which would make it harder over the coming months to get a mortgage. That means potential homebuyers could have a window of opportunity right now to lock in a satisfactory rate. Comparing rates between multiple lenders will help you find the best loan for your situation.30-year fixed mortgage interest ratesOn average, the interest rate for a 30-year mortgage on July 7 was 7.14%, up from 7.02% on June 30. 15-year fixed mortgage interest ratesOn average, the interest rate for a 15-year mortgage on July 7 was 6.50%, up from 6.42% on June 30. Jumbo mortgage interest ratesOn average, the interest rate for a 30-year fixed rate jumbo mortgage on July 7 was 6.95%, up from 6.90% on June 30. 5/1 adjustable-rate mortgagesOn average, the interest rate for a 5/1 ARM on July 7 was 7.10%, up from 6.95% on June 30.What determines mortgage rates?Mortgage rates are influenced by a variety of factors, including:Your credit scoreDown paymentYour debt-to-income ratio (DTI)The type of loan you’re gettingLoan termInterest rate type (fixed vs. adjustable)Inflation and the overall economyThe Federal Reserve (which doesn’t set mortgage rates, but it certainly influences them)APR vs. interest rateIf you’re currently shopping for a mortgage or considering refinancing, you’ve probably wondered why the quoted interest rate isn’t the same as the APR. That’s because the loan’s interest rate is what you pay the lender to borrow the money, while the APR (annual percentage rate) encompasses both the interest rate and all loan-related fees. Loan-related fees can include:Mortgage broker feesLoan origination feesMortgage insurance premiumsSome closing costsThe APR, therefore, is a truer measure of what it will actually cost you to borrow money to buy a home.Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.This article was reviewed by Lauren Williamson, who serves as the Home and Financial Services Editor for the Hearst E-Commerce team. Email her at [email protected].
Lauren Williamson is the Financial and Home Services Editor for the Hearst E-Commerce team. She previously served as Senior Editor at Chicago magazine, where she led coverage of real estate and business, and before that reported on regulatory law and financial reform for a magazine geared toward in-house attorneys. You can reach her at [email protected].
Hearst Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. This may influence which products we write about and where those products appear on the site, but it does not affect our recommendations or advice, which are grounded in research.Mobile app users, click here for the best viewing experience.Sacramento homebuyers seeking lower mortgage rates got more bad news last week: The average for a 30-year fixed-rate mortgage surged to 7.14% as of July 7, according to Mortgage News Daily. Earlier in the week they even touched 7.22%, within spitting distance of the 20-year highs they reached last October and November.In fact, real estate experts now advise that people who are waiting for the perfect moment to buy a house should give up trying to time mortgage rates, at least for the time being. Instead, they should go ahead and buy while prices are under pressure, with a plan to refinance once mortgage rates finally cool.
However, there are inklings that the Federal Reserve’s aggressive rate-hiking campaign is starting to cool the economy. The job report released on July 7 showed that 209,000 new jobs were added in June — the smallest gain in two-and-a-half years.
“The weaker job market combined with decelerating wage growth and calming consumer price inflation are clear indications for the Federal Reserve to stop raising interest rates,” said Lawrence Yun, chief economist with the National Association of Realtors.Nonetheless, most analysts expect the Fed to hike the benchmark borrowing rate two more times this year, with the next increase coming at its July meeting.Unsurprisingly, with the 30-year average up, mortgage rates rose across the board. The average for a 15-year fixed-rate mortgage was 6.50%, as of June 23, while the average for a jumbo mortgage was 6.95%. The average for a 5/1 ARM, meanwhile, was 7.10%. It’s not impossible to find better mortgage rates, however, by shopping around with various lenders.
Sacramento housing market trendsLong story short, the Sacramento housing market remains very competitive. In June, the median home sale price in Sacramento was $438,500, according to Rocket Mortgage. Redfin gives the city a “Compete Score” of 85 (with 100 being the most competitive score). For comparison, Roseville has a Compete Score of 79 and Elk Grove has a Compete Score of 83.New listings have also been down about 40% compared to last year, according to Ryan Lundquist of the Sacramento Appraisal Blog. Redfin says that the number of homes sold in Sacramento is also down year-over-year and that the average home in Sacramento sells for about 2% above list price these days. But fewer homes are selling above list price this year. In May 2022 about 70% of homes in Sacramento were selling above list price, whereas in June 2023 that percentage was 58.8%.People living in Sacramento don’t seem ready to flee the city for less expensive housing, though. Between April and June of this year, 29% of Sacramento homebuyers searched to move out of Sacramento, while 71% looked to stay within the metropolitan area, according to Redfin.Mortgage rate trendsThirty-year fixed-rate mortgage rates have more than doubled from the historically low rates of 2020 and 2021, when rates plummeted below 3%. Some economists were hopeful that the Federal Reserve’s decision at its June 14 meeting to hold the federal funds rate steady would trigger a decline in mortgage rates, but that hasn’t been the case yet. However, the Fed has cautioned that it can take a while for the full impact of its policy decisions to be felt, so rates could still fall this year. Many analysts zeroed in on the suggestion that two more quarter-point rate hikes will come later this year, once the Fed sees how its actions to date have worked. In the meantime, there are signs that the Fed’s policy moves are working: The Consumer Price Index rose 4% year-over-year in May, the smallest increase since 2021, though still well above the 2% target.National housing market trendsWhile new home sales were up in May, existing home listings remain at historic lows. New listings were down 25% year-over-year for the four weeks ending July 2, according to Redfin. As a result of the inventory squeeze, the average home is selling for only $1,000 less than it did last year. (Worth noting: At that time, the median home sale price was the highest ever. It’s now $383,800.) And, for the first time in nearly a year, homes are tending to sell above the list price — a sign that the market is picking up.Homebuyers this summer have been closely attuned to mortgage rates. Mortgage applications were down 4.4% for the week ending June 30 over the week before, according to the Mortgage Bankers Association. (The data for the prior week includes an adjustment for Juneteenth, which is a federal holiday.)“Purchase applications decreased for the first time in a month, as homebuyers remained sensitive to rate changes. Rates are still over a percentage point higher than a year ago, and housing affordability is still a challenge in many parts of the country,” said Joel Kan, MBA’s vice president and deputy chief economist. Homebuyers watching mortgage rates and waiting for the perfect moment to strike might not want to wait too long. Many economists predict an incoming credit crunch — when banks restrict borrowing to steady their finances — which would make it harder over the coming months to get a mortgage. That means potential homebuyers could have a window of opportunity right now to lock in a satisfactory rate. Comparing rates between multiple lenders will help you find the best loan for your situation.
30-year fixed mortgage interest ratesOn average, the interest rate for a 30-year mortgage on July 7 was 7.14%, up from 7.02% on June 30. 15-year fixed mortgage interest ratesOn average, the interest rate for a 15-year mortgage on July 7 was 6.50%, up from 6.42% on June 30. Jumbo mortgage interest ratesOn average, the interest rate for a 30-year fixed rate jumbo mortgage on July 7 was 6.95%, up from 6.90% on June 30. 5/1 adjustable-rate mortgagesOn average, the interest rate for a 5/1 ARM on July 7 was 7.10%, up from 6.95% on June 30.What determines mortgage rates?Mortgage rates are influenced by a variety of factors, including:Your credit scoreDown paymentYour debt-to-income ratio (DTI)The type of loan you’re gettingLoan termInterest rate type (fixed vs. adjustable)Inflation and the overall economyThe Federal Reserve (which doesn’t set mortgage rates, but it certainly influences them)APR vs. interest rateIf you’re currently shopping for a mortgage or considering refinancing, you’ve probably wondered why the quoted interest rate isn’t the same as the APR. That’s because the loan’s interest rate is what you pay the lender to borrow the money, while the APR (annual percentage rate) encompasses both the interest rate and all loan-related fees. Loan-related fees can include:Mortgage broker feesLoan origination feesMortgage insurance premiumsSome closing costsThe APR, therefore, is a truer measure of what it will actually cost you to borrow money to buy a home.
Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.This article was reviewed by Lauren Williamson, who serves as the Home and Financial Services Editor for the Hearst E-Commerce team. Email her at [email protected].
https://www.kcra.com/article/sacramento-housing-market-july-10/44507991
