Duplex Mortgage Rates Fall Below 7

Did you know mortgage interest rates are below 7%?

‘According to Mortgage News Daily, on Wednesday the rate on a 30-year fixed rate mortgage was 6.99 percent. a 30-year FHA mortgage was at 6.52 percent. A 30-year VA loan was at 6.55 percent.

Mortgage News Daily doesn’t account for real estate buyers who buy down their rate at closing – paying a little extra upfront in exchange for a lower term rate. The company Optimal Blue calculates the rates and includes rates resulting from buy downs, and saw a slightly better average on a 30-year conventional loan at 6.875 percent.

According to both sources, the rate drops are the result of encouraging economic news. The Consumer Price Index (CPI), showed prices rose 3.4 percent over April of 2023.  While that doesn’t sound like good news, it actually is. That’s because that was the smallest increase of any month year to date. Core CPI, which is basically the same measure minus the costs of food and energy stood at 3.6 percent. That’s down .2 percent from March.

Many people are waiting for interest rates to fall before deciding to either buy or sell a duplex. Most economists and futures traders believe the Federal Reserve won’t start reducing rates until September.

If you’re a Minneapolis duplex buyer or seller doing just that, remember two things. First, when the Federal Reserve starts making cuts, they don’t do it in big increments. In fact, it may take them well over a year to reduce rates by one point. And unless something catastrophic happens, it usually isn’t more than 1-2 points. Finally, when rates go down, everybody who’s been waiting to buy or sell rushes into the market.

That means more competition- for both buyers and sellers.

If you’re thinking of either buying or selling but aren’t sure if the market’s right for you, give me a call. I’m always glad to give you as much information as I can for you to make the best possible decision for you and your family.