Nebraska Mortgage Rates | January 28 2021

Weekly Rate Update

Rates fluctuate everyday and are based on several factors. For an exact rate quote, submit your request HERE for a free evaluation.

PMMS 1/28/2021

The average mortgage rate for a 30-year fixed loan fell four basis points last week to 2.73%. This is the second week mortgage rates have ticked downwards since Jan. 14’s sudden jump. The 15-year fixed mortgage rate also shifted downward to 2.2 from 2.21 the week prior.

With last week’s data now in, mortgage rates have hovered below 3% for six months, and housing affordability is feeling the strain. Home prices in November rose 9.5% nationally over the same time last year, according to the S&P CoreLogic Case-Shiller index.

Sam Khater, Freddie Mac’s chief economist, is concerned about rising home prices.

“Even as house prices increase at the fastest rate we’ve seen in years, competition to buy is strong given the low inventory that exists across the country. The fact that there are not enough homes to meet demand is going to be an ongoing issue for the foreseeable future,” Khater said.

While construction plays catch-up, the Fed showed no indication of increasing interest rates after the Federal Open Market Committee left future economic policies virtually unchanged at its Wednesday meeting, indicating that short-term mortgage rates will stay low for years to come.

Despite record low mortgage rates putting upwards pressure on home prices, Federal Reserve Chairman Jerome Powell said it is a “passing phenomenon.”

“There was a lot of pent-up demand. It’s a one-time thing happening with people who are spending all of their time in their house and thinking, ‘I need a bigger house or I need another house.’ But this is a one-time shift in demand that we think will get satisfied, and supply will be called forward so price increases are unlikely to be sustained,” Powell said.

MBA 1/27/2021

For the second week in a row, mortgage applications decreased – this time, down 4.1% for the week ending Jan. 22. The 30-year-fixed rate rose to 2.95%, its highest level since November 2020, according to Joel Kan, MBA associate vice president of economic and industry forecasting. All other mortgage rates in the survey posted a decline.

“In a sign that borrowers are increasingly more sensitive to higher rates, large declines in government purchase applications and refinance applications pulled overall activity lower,” Kan said. “Purchase applications also decreased last week, but the impressive trend of year-over-year growth since the second half of 2020 has continued in early 2021.”

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