Workflow
Mortgage rates drop on jobs report
CNBC Televisionยท2025-09-05 17:42

Mortgage Rate Trends - The average 30-year fixed mortgage rate experienced a significant one-day drop of 16 basis points, reaching 629%, the lowest since October 3rd of last year [1] - Some lenders are offering even better rates, around 6125%, a substantial decrease from rates exceeding 7% in May [2] - The drop in mortgage rates is influenced by the yield on the 10-year Treasury, but also by future economic outlook and the perception of mortgage-backed securities (MBS) buyers [6] Impact on Homebuyers and Market - For a $450000 home with 20% down, the monthly mortgage payment at 7% would be $23995, while at the current rate, it would be $2226, a difference of $169 per month [2] - Lower mortgage rates have positively impacted homebuilder stocks, with companies like Lennar and DR Horton experiencing gains of over 3% [3] - The home building ETF (ITB) has increased by nearly 13% over the past month as rates have gradually decreased [4] - Despite falling rates, mortgage applications for home purchases have not significantly increased [4] - Some believe that mortgage rates need to drop to the 5% range to significantly impact homebuyer activity, considering the high home prices [5] - Homebuyers' confidence in their personal financial situation and the broader economy plays a crucial role in their decision to invest in a home [6][7]