After two months of near perfect stability, interest rates on conventional mortgages for newly built homes declined noticeably in October, according to data released this week by the Federal Housing Finance Agency.
National Association of Home Builders economist Paul Emrath looks at the FHFA data, and does some exploration of both the causes and the effects of the rate pull-back. Correlated with the interest rate decline, average prices of new homes bought with conventional loans, and the effective interest rates also went down from recent peaks.
Net, net, some of the data could reflect the very beginning of a mix shift in pricing toward more attainable prices in homes, with lower loan amounts.
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