Bond yields drop this week – The 10-year Treasury bond closed the week at 2.19%, down from 2.27% last week. The 30-year treasury yield ended the week at 2.79%, down from 2.84% last week. Mortgage rates follow treasury bond yields so we watch bond yields carefully.
Mortgage Rates down slightly this week – The August 10, 2017 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 3.90%, down slightly from 3.93% last week. The 15-year fixed was 3.18%, down from 3.18% last week. The 5-year ARM was 3.14%, almost unchanged from 3.15% last week. Rates dropped late in the week. Next week’s survey rates should be even lower.
Home affordability slips in California as prices rise – The California Association of Realtors reported that 29% of California households could afford to buy a $559,260 median-priced home in the second quarter. That is down from 32% in the first quarter of 2017 and 31% one year ago in Q2 2016. The annual income required to purchase the median-priced home was $110,780. They found that 38% of California households were able to purchase a median-priced condominium or town-house, which was $443,400. The annual income required was $88,870.