Miami Market Report: Interest/Mortgage Rates Report for February 2024

First we need to talk about the main US interest rates right now: The Federal Reserve keeps key rate unchanged at about 5.4%, a 22-year high which signals cuts are likely months away. Now without going into all the details, many economists think that interest rates might not come down until June.

Now for home buyers, the average rate on a 30 year MORTGAGE fell SLIGHTLY to 6.63% from 6.69% last week says FREDDIE MAC. A year ago, the rate averaged 6.09%. On 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell this week, pulling the average rate down to 5.94% from 5.96% last week. A year ago, it averaged 5.14%

The cost of financing a home recently since the average rate on a 30-year mortgage hit 7.79%, the highest level since late 2000. So far this year, the weekly average has ranged between 6.60% and 6.69%. Elevated mortgage rates and the low inventory of homes have kept the US housing market mired in a slump the past two years. Sales of previously occupied U.S. homes sank to a nearly 30-year low last year, tumbling 18.7% from 2022.

But REMEMBER that MIAMI is a special localized market where we did not experience the national slump due to our influx of population, large numbers of international & domestic investors and emerging world prominence. The Miami market has stabilized and remained level the past 6 to 8 months.

For now, the average rate on a 30-year mortgage remains sharply higher than just two years ago, when it was 3.55%. Also keep in mind that 80% of home/condo sales happen from MARCH to SEPTEMBER.

That means, right now the smart buyers are buying as overall inventory is still tight, many properties are selling below listing price and there are not yet as many buyers thus meaning less competition which will drive up the prices.