Last week, Freddie Mac registered a 3.29% 30-year fixed mortgage rate, the lowest rate since they they started the survey in 1971. This comes after growing concerns about the economic effects of the coronavirus and a corresponding Fed rate cut. It is contrasted by a plummeting stock market, which saw the Dow down by over 1,400 and the S&P sink 5% in the openings minutes of trading this morning.
Despite the significant stock market woes, buyers seem to be (at least for the time being) buoyed by these historically low mortgage rates. 18 single-family homes went into contract in Redwood City last week, sending out inventory back down into the 30's. Meanwhile, our closed sales were on the market for an average of just 13 days, and with a sizable sample size of 12 sales, registered a whopping $2.79 million average sales price.
I would expect to see mortgage rates stay at record lows throughout these current stock market struggles. What will be interesting to see, is whether these low rates persist after the stock market shows signs of recovery, and how that will impact buyer activity.