MCLEAN, Va. - Freddie Mac (OTCQB: FMCC (OTC:FMCC)) announced on Thursday that the 30-year fixed-rate mortgage (FRM) has held steady at an average of 6.35 percent, according to its Primary Mortgage Market Survey® (PMMS®). This rate remains unchanged from the previous week and is down from the 7.12 percent average reported one year ago.
The survey also noted a slight decrease in the 15-year FRM, which averaged 5.47 percent, down from 5.51 percent last week. This time last year, the 15-year FRM was at an average of 6.52 percent.
The PMMS® focuses on conventional, conforming, fully amortizing home purchase loans for borrowers who are able to put down 20 percent and possess excellent credit. Freddie Mac's Chief Economist, Sam Khater, highlighted that despite the summer's declining mortgage rates, home sales have not seen a significant uptick. However, there has been an increase in refinancing activity as homeowners seek to benefit from the lower rates to reduce their monthly payments.
Freddie Mac, established in 1970, has the mission of making home ownership accessible for families across the United States. It supports the housing market by promoting liquidity, stability, affordability, and equity, regardless of the economic climate. Over the decades, the organization has assisted tens of millions of families in purchasing, renting, or maintaining their homes.
This week's mortgage rate announcement comes as the market anticipates the August jobs report, which could potentially influence future rate adjustments.
The information reported here is based on a press release statement and reflects the current state of the mortgage market as presented by Freddie Mac.
In other recent news, Freddie Mac has reported a series of fluctuations in the U.S. 30-year fixed-rate mortgage. The rate has reached its lowest point since May 2023, averaging 6.46%, a slight decrease from the previous week's average of 6.49%. In contrast, last year during the same period, the average rate was significantly higher at 7.23%. Despite the decline in mortgage rates, potential homebuyer interest has not significantly increased.
The National Association of Realtors (NAR) has reported a 1.3% rise in existing home sales in July, ending a four-month streak of declines. However, the pace of home sales remains sluggish according to Lawrence Yun, NAR's chief economist.
Freddie Mac's chief economist has stated that the downward trend in rates is expected to continue through the end of the year, influenced by a softening of incoming economic data. However, they also noted that despite positive indicators, consumer confidence remains tentative, and affordability issues continue to be a significant concern for homebuyers. These are recent developments that potential investors should take into consideration.
InvestingPro Insights
As Freddie Mac (OTCQB: FMCC) continues to play a pivotal role in the U.S. housing market, recent data from InvestingPro provides insights into the company's financial health and stock performance. With a market capitalization of $3.61 billion, Freddie Mac remains a significant entity in the financial services industry. Despite a challenging period, analysts are optimistic about the company's prospects, expecting net income growth this year. This aligns with Freddie Mac's essential role in providing stability and liquidity to the mortgage market, as reflected in the steady mortgage rates reported in the Primary Mortgage Market Survey®.
InvestingPro Tips suggest that Freddie Mac's stock has been characterized by high price volatility, which could be a point of consideration for investors looking at the financial sector. Additionally, the company's prominence in the industry is undisputed, and while it has not been profitable over the last twelve months, there is a forecast for profitability in the current year. For those interested in a deeper dive, there are additional tips available on InvestingPro, offering a comprehensive analysis of Freddie Mac's performance and outlook.
From a stock performance perspective, Freddie Mac has seen a high return over the last year, with a price total return of 81.54%. This could be indicative of the company's resilience and the market's response to its strategic initiatives. Moreover, with liquid assets exceeding short-term obligations, Freddie Mac showcases a solid liquidity position, which is crucial for its operations in the dynamic housing finance landscape.
For investors and industry observers looking to stay informed on Freddie Mac's financial metrics and stock analysis, InvestingPro offers a wealth of additional tips and real-time data, providing a valuable resource for making informed decisions.
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