Two U.S. bank failures sent Wall Street investors scurrying into bonds this week, providing the real estate industry with an unexpected boon on the brink of its busiest season: the lowest mortgage rates in three weeks.
... [+]Two U.S. bank failures sent Wall Street investors scurrying for the perceived safety of the bonds markets this week, providing the real estate industry with an unexpected boon on the brink of its busiest season: the lowest mortgage rates in three weeks.
The average U.S. rate for a 30-year fixed-rate home loan fell to 6.6% from 6.73% last week, according to a report fromon Thursday. A boost in competition for bonds including Treasuries and mortgage-backed securities typically results in lower yields for investors and cheaper borrowing costs for homebuyers.
“Mortgage rates are down following an increase of more than half a percent over five consecutive weeks,” said Sam Khater, Freddie Mac’s chief economist. “Turbulence in the financial markets is putting significant downward pressure on rates, which should benefit borrowers in the short term.”, the 16th-largest U.S. commercial bank by assets, and on Sunday seized Signature Bank, a smaller bank based in New York that catered to cryptocurrency investors.
As a result of market volatility, investors this week have been shifting money into bonds, sending the , a benchmark for mortgage rates, to a six-week low of 3.42% on Thursday, according to data from Intercontinental Exchange.
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