What's in this article?
May is almost here and the spring 2023 homebuying season is just starting to heat up!
Here’s what you need to know about the real estate market across America and how mortgage rates are fairing.
Mortgage Rate Update and Changes in Fee Structure Impacting the Housing Market in 2023
30-year rates unchanged for new mortgages and refinance
The average daily rate for a 30-year fixed-rate loan was 6.93% as of April 25th, unchanged from the day before and down 2 basis points from a week ago.
The refinance rate was 7.14% (30-year fixed), also unchanged from the previous day and declining 2 basis points from this point last week.
15-year fixed-rate loans
The 15-year fixed rate averaged 6.34%, a 52-week high, rising 11 basis points from the previous week but, like the 30-year rate, unchanged from yesterday.
The rate for loans that pass the conforming loan limit was 6.98%, down 3 basis points from yesterday and 8 from the same day a week ago.
The average here was 5.74%, 1 basis point down from yesterday and up 9 basis points from the same day last week.
Rates for FHA and VA loans
The rate for 30-year FHA loans was 6.14%, declining 15 basis points from the previous day and 25 basis points from the same day last week. On the other hand, VA loans hit a rate of 6.10%, down 7 basis points from yesterday and a decrease of 10 basis points from the prior week.
Changes coming in mortgage fee structure
Reports have surfaced that starting in May 2023, significant changes to the mortgage fee structure will be implemented.
These changes include a reduction in fees for borrowers with lower credit scores, as well as an increase in fees for borrowers with higher credit scores.
This shift is intended to make homeownership more accessible for individuals with bigger credit score challenges who have traditionally faced higher barriers to entry into the housing market.
However, this change may have unintended consequences as it may lead to an increase in the number of risky loans being made, potentially causing instability in the mortgage industry. Borrowers with higher credit scores may also feel the pinch as they face higher fees, which could discourage some from purchasing a home.
Want more personalized rates?
Get customized rates tailored to your individual mortgage needs.See Today’s Rates
Legal marijuana and its impact on local housing markets
Realtor.com published a discussion on the impact of legal marijuana on local housing markets in 2023.
As more states legalize marijuana for recreational use, the real estate industry has observed a correlation between legalization and increased property values. This is likely due to the economic benefits of the marijuana industry, such as job creation and increased tax revenue.
However, the article also notes that the impact of legal marijuana on housing markets varies by location. In some cases, marijuana dispensaries have been found to negatively impact property values due to concerns about crime, traffic, and noise, while other areas have seen positive effects from legalization.
Government data shows new home sales are up
A press release from the Census Bureau says that sales of new single‐family houses during March 2023 were estimated at an annual rate of 683,000 (seasonally adjusted). This is a 9.6 percent (±15.2 percent) increase compared to the revised February rate of 623,000 but 3.4 percent (±12.7 percent) lower than the March 2022 estimate of 707,000.
The median sales price for new houses sold in March 2023 was $449,800, and the average sales price was $562,400.
Finally, the seasonally‐adjusted estimate of new houses up for sale at the end of March was 432,000—representing a supply of 7.6 months if the current sales rate holds.