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Mortgage rate forecast for 2020: Experts predict low rates will last

The average 30-year fixed mortgage rate started 2019 at 4.68% and steadily declined before closing out the year at 3.93 percent. In 2020, rates are expected to remain mostly stable, not straying too much higher or lower from the 4% mark.

Here are responses from a range of experts predicting what will happen to mortgage rates in 2020.

Expect mortgage rates to remain low

Greg McBride, CFA, Bankrate chief financial analyst, predicts mortgage rates will stay relatively stable around 4% in 2020.

“The benchmark 30-year fixed rate mortgage will hopscotch back and forth over the 4% mark for much of 2020, remaining low enough to facilitate homebuying and providing ample refinancing opportunities on those trips below 4 percent,” he says.

Since the end of June 2019, interest rates for the 30-year fixed-rate mortgage have stayed south of the 4% mark. They hit their lowest point on Sept. 4, dropping to 3.74 percent, according to Bankrate data. These historically low rates have helped homeowners save money by refinancing and made it easier for folks to afford to buy a house.

read more at: https://www.bakersfield.com/ap/news/natalie-campisi-mortgage-rate-forecast-for-experts-predict-low-rates/article_e8d24523-a035-5686-9c25-fb91cc46de5e.html

San Diego home prices, sales up in October

San Diego County’s median home price was $573,500 in October, lifted by a big increase in sales.

There were 3,485 home sales, up 10.1 percent compared to the same time last year, said CoreLogic data provided by DQNews. Experts have largely attributed the turn in the market to falling interest rates.

The median price of $573,500 is an increase of 2.6 percent in a year. That is an improvement over the past few months, which showed prices flat in San Diego County. However, at the same time last year, prices were up 5.6 percent in a year.

San Diego County was not alone in this trend. In Southern California home sales were up around 8 percent, and median prices moved up slightly. The uptick in prices seemed to correlate with other indicators of a rebounding market, including a drop in the number of price reductions in San Diego County and across Southern California from earlier this year.

Interest rates for a 30-year, fixed-rate mortgage were 3.69 percent in October, said Freddie Mac, down from 4.83 percent at the same time last year.

While lower interest rates may have helped potential buyers, home inventory was tightening. There were 6,082 homes for sale in October, said the Greater San Diego Association of Realtors, down from 7,918 at the same time last year.

read more at: https://www.sandiegouniontribune.com/business/real-estate/story/2019-11-21/san-diego-home-prices-sales-up-in-october

Mortgage debt hits new high

Mortgage debt has increased to $9.44 trillion according to the latest Quarterly Report on Household Debt and Credit from the New York Federal Reserve. Household debt in total increased by $92 billion (0.7%) to $13.95 trillion in Q3 2019. This is the 21st consecutive quarter with an increase, and the total is now $1.3 trillion higher, in nominal terms, than the previous peak of $12.68 trillion in the third quarter of 2008.

Mortgage balances—the largest component of household debt—rose by $31 billion in the third quarter to $9.44 trillion. Balances on home equity lines of credit (HELOC), which have been declining since 2009, fell by $3 billion this quarter, bringing the aggregate outstanding balance to $396 billion.

“New credit extensions were strong in the third quarter of 2019, with auto loan originations reaching near-record highs and mortgage originations increasing significantly year-over-year,” said Donghoon Lee, research officer at the New York Fed. “The data suggest that households are taking advantage of a low-interest rate environment to secure credit.”

Credit standards tightened slightly in the third quarter of 2019, with the median credit score of newly originating mortgage borrowers rising to 765, a 6-point increase from the previous quarter.

The New York Fed also notes that flows into delinquency among mortgage loans were mostly unchanged from the previous quarter, and foreclosures remain very low by historical standards. Approximately 65,000 individuals had a new foreclosure notation added to their credit reports between July 1- September 30, 2019. As of June 2018, CoreLogic notes that the national share of mortgages that were in some stage of delinquency was 4% in June 2019—a 0.3 percentage point decline, compared to last year’s 4.3%.

The share of mortgages that are delinquent more than 90 days fell from 1.2% to 0.9%, and the percentage of mortgages that were more than 120 days delinquent dropped to 1% from 1.4% in June 2018.

read at: https://dsnews.com/daily-dose/11-14-2019/mortgage-debt-hits-new-highs