- Mortgage rates dropped 12 basis points to 6.63% on Thursday, the lowest since October, driven by a stock market sell-off after Trump’s tariff announcement, pushing investors into bonds and lowering the 10-year Treasury yield.
- Affordability remains strained, with Redfin noting a record $2,802 monthly payment amid 3.4% higher sale prices and a 6.65% rate, while 70% of households (94 million) can’t afford a $400,000 home, and 52.87 million are capped at $200,000 homes needing a $61,487 income.
- Listings rose 10% and active inventory 28% in March per Realtor.com, but pending sales fell 5.2%, with steep drops in Jacksonville (15.1%), Miami (13.7%), and Virginia Beach (14.2%), as supply skews high-end and economic concerns linger despite the rate dip.
Mortgage rates took a notable dip on Thursday, with the 30-year fixed loan average falling 12 basis points to 6.63%, the lowest since October, spurred by the Trump administration’s tariff announcement that jolted financial markets. This drop followed a massive stock market sell-off, driving investors into bonds and pushing down the 10-year U.S. Treasury yield, which mortgage rates loosely track, as noted by Matthew Graham, chief operating officer at Mortgage News Daily. Graham emphasized that while the tariff details remain murky, the market’s reaction signals bracing for a hit to global trade, a shift that’s brought some relief to homebuyers just as the spring housing season heats up.
Despite this rate decline, affordability remains a steep hurdle, with Redfin reporting the typical U.S. homebuyer’s monthly payment hitting a record $2,802 for the four weeks ending March 30, fueled by a 3.4% year-over-year rise in sale prices and a weekly average rate of 6.65%. The National Association of Home Builders estimates that 70% of U.S. households – about 94 million – can’t afford a $400,000 home, with the median new home price projected at $460,000 in 2025. For a $200,000 home at a 6.5% rate, a minimum income of $61,487 is needed, a threshold that caps 52.87 million households, leaving them priced out of most of the market as supply grows but skews toward higher-end properties.
The housing market is showing signs of rebalancing, with Realtor.com noting a 10% annual increase in new listings and a 28% jump in active listings for March, yet homes linger longer, price cuts rise, and pending sales in major metros dropped 5.2% from last year. Steep declines hit Jacksonville, Florida (15.1%), Miami, Florida (13.7%), and Virginia Beach, Virginia (14.2%), reflecting softening demand tied to economic worries and shifting migration patterns. Redfin agent Matt Ferris in northern Virginia told CNBC he has noticed an uptick in sellers listing their homes—some aiming for top dollar, others responding to job market concerns. Meanwhile, Realtor.com’s chief economist Danielle Hale views the recent rate drop as a potential lift for the late spring housing market, though lingering economic uncertainties could still deter buyers. The chronic undersupply since the Great Recession keeps inventory tight, especially at lower price points, tempering the benefits of this rate relief.
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