Feb. 27, 2019

Florida consumers’ optimism rises to near-record levels

GAINESVILLE, Fla. – Feb. 26, 2019 – Consumer sentiment among Floridians increased 2.8 points in February to 100.9 from a revised figure of 98.1 in January – strong levels of confidence haven't been seen since January 2018, when consumer sentiment reached 101.3 points. This month's reading is the second highest since March 2002.

Among the five components that make up the index, three increased and two decreased.

Floridians' opinions of their personal financial situation now compared with a year ago increased 1.3 points from 93.8 to 95.1. However, opinions varied greatly by gender and income levels, with male respondents and those with income levels under $50,000 reporting less-favorable opinions.

In contrast, overall opinions as to whether this is a good time to buy a major household item like an appliance decreased 1.1 points from 100.2 to 99.1. Again, men reported less-favorable opinions compared with women.

"Despite the differing opinions by gender, overall these two components of the index showed that perceptions regarding the current economic conditions increased slightly among Floridians in February," says Hector H. Sandoval, director of the Economic Analysis Program at UF's Bureau of Economic and Business Research.

Future economic condition expectations were also mixed. Expectations of personal financial situations a year from now decreased slightly: nine-tenths of a point from 109.1 to 108.2. Yet, expectations of U.S. economic conditions over the next year showed the greatest increase, up 7.9 points from 93.5 to 101.4. Similarly, expectations of U.S. economic conditions over the next five years increased 6.7 points from 94 to 100.7.

"Overall, Floridians are more optimistic. The increase in February's confidence comes mostly from consumers' future expectations about the national economy in the medium- and long-run. Importantly, these outlooks are shared by all Floridians regardless of their gender, age or socioeconomic status," Sandoval says.

Economic indicators in Florida remained positive. In particular, the labor market in Florida continued to add more jobs in December, and the monthly unemployment rate in Florida remained unchanged at 3.3 percent. Similarly, the U.S. labor market has continued to strengthen, and economic activity has been rising at a solid rate.

As a result, the Federal Open Market Committee decided to maintain the range of the federal funds interest rate between 2.25 and 2.5 percent in their last meeting in January, stopping any potential increase in the cost of borrowing in the short-run.

"Looking ahead, in view of the realized economic outlook, we anticipate consumer sentiment to remain high in Florida," Sandoval said.

Conducted Feb. 1-21, the UF study reflects the responses of 375 individuals who were reached on cellphones, representing a demographic cross section of Florida. The index used by UF researchers is benchmarked to 1966, which means a value of 100 represents the same level of confidence for that year. The lowest index possible is a 2, the highest is 150.

© 2019 Florida Realtors®  

Feb. 26, 2019

Fed report suggests few or no interest-rate hikes this year

WASHINGTON (AP) – Feb. 25, 2019 – The Federal Reserve said Friday that in light of a slowing global economy and last year's financial market turmoil, the central bank intends to remain "patient" in determining when to make future changes in its benchmark interest rate.

The Fed's semi-annual report to Congress on monetary policy stood in contrast to its last report in July when it signaled that it was on track to keep raising rates at a gradual pace over the next two years.

The new report cites a range of risks to the economy that have developed over the last six months, as well as continued muted inflation as reasons to slow further hikes.

Many private economists believe the Fed may raise rates at most only one more time late this year. And some analysts are even forecasting that the next move will be a cut in rates as the Fed confronts a slowing economy this year.

At its last meeting in January, the Fed left rates unchanged at a level of 2.25 percent to 2.5 percent and signaled a major pivot away from steadily raising rates by declaring that it intended to be "patient" in deciding when to raise rates again.

Various Fed officials including Fed Chairman Jerome Powell have emphasized that change in speeches since the Jan. 29-30 meeting. Powell will testify on the Fed's Monetary Policy report before Senate and House committees next Tuesday and Wednesday.

The report noted the turbulence that hit markets in the final three months of last year. But unlike President Donald Trump, who tied falling stock prices to the Fed's rate hikes, the central bank cited other factors including Trump's trade policies.

"Financial market participants' appetite for risk deteriorated markedly in the latter part of last year amid investor concerns about downside risks to the growth outlook and rising trade tensions between the United States and Canada," the monetary report said.

The Fed's decision in January triggered a big rally in stock prices as investors grew less concerned that the Fed could over-do its tightening cycle and push the country into a recession.

The Fed had raised rates four times in 2018 and signaled in December that it expected to hike rates another two times in 2019.

Among the highlights of the Fed's monetary report:

  • Economic growth was impacted by slower consumer spending and business investment in the second half of 2018. The housing market also weakened amid rising mortgage rates and higher material and labor costs. A softening in consumer and business sentiment since the fall likely reflected financial market volatility and increased concerns about the global outlook.
  • The Fed has been trimming its balance sheet by not reinvesting some Treasury securities and mortgage-backed bonds as they mature, resulting in a drop in total Fed assets of about $260 billion since the middle of last year. The Fed's balance sheet ended the year close to $4 trillion, down from a high of $4.5 trillion before the Fed began trimming the balance sheet in October 2007. The Fed minutes from its January meeting indicated that the central bank is close to announcing a plan for drawing the balance sheet reduction to a close.
  • While unemployment has fallen close to a 50-year low, not all areas of the country have benefited equally with rural areas lagging behind metropolitan areas. The Fed said broader economic trends, such as the ongoing shift that has favored workers with more education, has resulted in rural areas getting left behind.

Copyright © 2019 The Associated Press, Martin Crutsinger. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Feb. 25, 2019

Millennials now top mortgage-borrowing generation

SANTA CLARA, Calif., – Feb. 22, 2019 – By dollar volume, millennials now take out more mortgage money than any other generation, according to a study by Realtor.com. They have surpassed both Generation X and the baby boomers.

Realtor.com based its analysis on data about residential mortgage loan originations from Optimal Blue, show that while the median home buying price millennials take on is still lower than that of Generation X or baby boomers, millennials are showing interest in more affordable markets. Additionally, millennials are making lower down payments and taking on larger mortgages when compared to Gen Xers and baby boomers.

“Millennials are getting older, with better jobs and deeper pockets, allowing them to expand their collective purchase power, and hence, their footprint in the market,” says Javier Vivas, director of economic research at realtor.com.

“The stereotype that millennials primarily choose to buy homes and live in large metro areas isn’t the reality,” he adds. “Results show millennials’ expansion is more heavily conditioned by affordability than in prior years, so their eyes are set on less traditional secondary markets where homes and jobs are now available and plentiful.”

Affordability is such a key factor for millennial homebuyers that they’re moving to places previous generations have not, like Buffalo, N.Y., the top affordable market for millennials, according to realtor.com’s study.

Millennials’ increased buying power

Millennials are still primarily in the life stage that requires starter homes. Despite a lower median purchase price ($238,000) than the two generations before them, (with baby boomers and Gen Xers spend an average $264,000 and $289,000, respectively), millennials are increasing their purchase price at a faster rate than previous generations which suggests that they’re starting to move beyond starter homes.

Since early 2017, millennials have been the largest mortgage purchasers by the number of loans originated, surpassing Generation X as the leader in January 2017. As 2018 came to a close, millennials took on nearly half (45 percent) of all new mortgages, compared to 36 percent for Generation X and 17 percent for baby boomers.

In November 2018, millennials finally overtook Generation X as having the largest share of new loans by dollar volume – 42 percent in December compared to 40 percent for Generation X and 17 percent for baby boomers.

Millennial home buying driven by affordability

In addition to increasing their buying power and taking on larger mortgages, the data shows millennials have consistently made lower downpayments than other generations since 2015. While other generations have increased their downpayments in response to rising prices, millennials have not been able to do so.

Millennial downpayments averaged 8.8 percent in December 2018, compared to 11.9 percent for Generation X and 17.7 percent for more equity-rich baby boomers. The downpayment challenge for millennials is a likely reason they’re moving more to affordable markets where their money goes further.

Top U.S. markets for homebuyers varies by generation

Within the last year, millennials have moved to affordable areas with strong job markets where they have more buying power. At the end of 2018, the median price of a mortgaged home purchased by millennials was $238,000 – $26,000 less than the median price of a home mortgaged by baby boomers ($264,000) and $51,000 than Generation X ($289,000). The top five markets where millennials now generate more than 50 percent of the mortgages:

  1. Buffalo, N.Y.
  2. Pittsburgh
  3. Milwaukee
  4. Cincinnati
  5. Columbus, Ohio

Members of Generation X are in their prime income-earning years, and they purchased homes in strong job markets and secondary home markets, with five of the 10 markets on the list having unemployment rates higher than the national rate of 3.7 percent. The top five markets where Gen X purchased a large and/or growing share of homes are:

  1. Los Angeles
  2. Providence, R.I.
  3. Bridgeport, Conn.
  4. Jacksonville, Fla.
  5. Atlanta

Many boomers are retired or rapidly approaching retirement, and therefore, showed a strong preference for buying homes in markets within primarily low-tax states or markets that are lower-cost than nearby metros, presumably to maintain wealth earned during their working years throughout their senior years. The top five markets where boomers made up a large and/or growing share of mortgaged purchases are:

  1. Knoxville, Tenn.
  2. Sacramento, Calif.
  3. Memphis, Tenn.
  4. Oklahoma City
  5. Riverside, Calif.

© 2019 Florida Realtors®

Feb. 22, 2019

Florida's housing market: Median prices, inventory up in January

ORLANDO, Fla. – Feb. 21, 2019 – Florida's housing market reported more new listings, higher median prices and increased inventory (active listings) in January compared to a year ago, according to the latest housing data released by Florida Realtors®. However, uncertainty over mortgage interest rates, the stock market and the federal government's shutdown may have affected home sales, which were lower than the level of sales a year ago. Sales of single-family homes statewide totaled 15,526 last month, down 6.2 percent compared to January 2018.

"As the new year gets underway, more new listings and gains in inventory (active listings) are positive signs for potential homebuyers in Florida," says 2019 Florida Realtors President Eric Sain, a Realtor and district sales manager with Illustrated Properties in Palm Beach. "Having more homes available for sale in many local markets may start to ease some of the affordability constraints we've been seeing for a long time. In January, new listings for existing single-family homes rose 5.6 percent compared to a year ago and new listings for condo-townhouse properties increased 2.5 percent."

In January, statewide median sales prices for both single-family homes and condo-townhouse properties increased year-over-year for the 85th month-in-a-row. The statewide median sales price for single-family existing homes was $249,900, up 4.1 percent from the previous year, according to data from Florida Realtors Research Department in partnership with local Realtor boards/associations. Last month's statewide median price for condo-townhouse units was $182,500, up 2.8 percent over the year-ago figure. The median is the midpoint; half the homes sold for more, half for less.

According to the National Association of Realtors (NAR), the national median sales price for existing single-family homes in December 2018 was $255,200, up 2.9 percent from the previous year; the national median existing condo price was $240,600. In California, the statewide median sales price for single-family existing homes in December was $557,600; in Massachusetts, it was $375,000; in Maryland, it was $284,000; and in New York, it was $272,043.

Looking at Florida's condo-townhouse market in January, statewide closed sales totaled 6,739, down 10.9 percent compared to a year ago. Closed sales may occur from 30- to 90-plus days after sales contracts are written.

"Inventory levels continued to rise across almost every price level in January, while closed sales were down on a year-over-year basis, as price growth continued on a steady path toward moderation," said Florida Realtors Chief Economist Dr. Brad O'Connor. "At the end of January, there were 13.8 percent more single-family homes listed for sale (active listings/inventory) in Florida than there were a year prior, reaching a statewide level of single-family inventory not seen since March of 2015. The ongoing rise in inventory continues to be rather broad-based – among the price tiers tracked by Florida Realtors, single-family inventory only fell among the small segment of homes priced below $100,000. This is a significant change from a year ago, when much of the state's mid-tier inventory was still declining.

"Looking at condo-townhouse properties, the statewide count of active listings in January reached its highest level since May of 2012, after rising by 10.1 percent on a year-over-year basis."

According to Freddie Mac, the interest rate for a 30-year fixed-rate mortgage averaged 4.46 percent in January 2019, up from the 4.03 percent averaged during the same month a year earlier.

To see the full statewide housing activity reports, go to Florida Realtors Research & Statistics section on floridarealtors.org. Realtors also have access to local market stats (password protected) on Florida Realtors' website.

© 2019 Florida Realtors®  

Feb. 20, 2019

New homes: Builders see spike in optimistic buyers

LAS VEGAS – Feb. 19, 2019 – Builder confidence in the market for newly-built single-family homes rose four points to 62 in February, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI) released in Las Vegas during the 75th annual International Builders' Show.

"Ongoing reductions in mortgage rates in recent weeks coupled with continued strength in the job market are helping to fuel builder sentiment," says NAHB Chairman Randy Noel. "In the aftermath of the fall slowdown, many builders are reporting positive expectations for the spring selling season."

February marked the second consecutive month in which all HMI indices posted gains. The index measuring current sales conditions rose three points to 67, the component gauging expectations in the next six months increased five points to 68, and the metric charting buyer traffic moved up four points to 48.

"The five-point jump on the six-month sales expectation for the HMI is due to mortgage interest rates dropping from about 5 percent in November to 4.4 percent this week," says NAHB Chief Economist Robert Dietz. "However, affordability remains a critical issue. Rising costs stemming from excessive regulations, a dearth of buildable lots, a persistent labor shortage and tariffs on lumber and other key building materials continue to make it increasingly difficult to produce housing at affordable price points."

Looking at the three-month moving averages for regional HMI scores, the South posted a one-point gain to 63 while the Northeast dropped two points to 43. The Midwest and West each remained unchanged at 52 and 67, respectively.

Derived from a monthly survey NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as "high to very high," "average" or "low to very low." Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

© 2019 Florida Realtors®

Feb. 19, 2019

Florida Housing relaunches first-time homebuyer program

TALLAHASSEE, Fla. – Feb. 18, 2019 – On March 4, the Florida Housing Finance Corporation (Florida Housing)will relaunch the Florida Hardest-Hit Fund Down Payment Assistance Program (HHF-DPA) in five approved counties.

This federal program was originally implemented to prevent foreclosures by stimulating home purchase activity and stabilizing neighborhoods in certain counties that demonstrated high levels on housing market distress.

HHF-DPA provides up to $15,000 in down payment and closing cost assistance to eligible first-time homebuyers and is forgivable over five years. Florida Housing has successfully disbursed 100 percent of the over $1 billion in HHF program funds allocated by the U.S. Department of Treasury two years ahead of schedule and is now using approximately $20 million in repayments of HHF program loans to assist additional Floridians.

Previously, HHF-DPA was available in 11 Florida counties. For the relaunch, Florida Housing used the latest market data to conduct a Treasury-mandated assessment of lingering negative effects in local housing markets. Based on this assessment, Florida Housing will assist eligible first-time homebuyers in Clay, Duval, Hillsborough, Osceola and Pasco counties.

"Statistics show that foreclosures have drastically decreased in Florida and that our state has recovered from the housing crisis," said Trey Price, executive director of Florida Housing. "This funding will further assist with the continued stabilization of recovering, distressed neighborhoods."

As of Jan. 31, 52,742 Florida families have received assistance through HHF programs and more than 20,000 received down payment and closing cost assistance through HHF-DPA. It is estimated that approximately 1,500 eligible first-time homebuyers will be assisted with this additional funding.

First announced on Feb. 19, 2010, by the U.S. Department of the Treasury, the Housing Finance Agency (HFA) Innovation Fund for the Hardest-Hit Housing Markets (HFA Hardest-Hit Fund) provides federal funding to states hardest hit by the aftermath of the burst of the housing bubble. Funding was allocated to 18 states and the District of Columbia.

Florida Housing was created by the Legislature more than 35 years ago. It's the state's housing finance agency (HFA) that administers state and federal resources to help provide affordable homeownership and rental housing options for the citizens of Florida. For more information, visit floridahousing.org.

© Copyright © 2019, Highlands News-Sun, Karen Clogston. All Rights Reserved.  

Feb. 15, 2019

Wallpaper: Should sellers tear it down or keep it up?

CHICAGO – Feb. 14, 2019 – Wallpaper is once again an attractive decorating trend for homeowners looking for textures and accents, but it's not for everyone.

Designer Jessica Lagrange of Jessica Lagrange Interiors in Chicago works primarily with luxury clients who love wallpaper. Here's what she advises about the "stay or strip" decision before listing a home.

  1. The clash test. Some wall coverings are neutral, such as those with small patterns, intriguing textures in soft hues or subtle metallic finishes. These are assets if they're chosen in conservative or traditional colors, Lagrange says. The litmus test is how severely the print clashes with a range of furnishings and artwork.
  2. An education campaign. There are wallpaper treatments that are extraordinary, such as some scenic designs that cost thousands of dollars. Listing agents should have a strategy in place to educate buyers and other agents who aren't familiar with them if a home has one. If buyers aren't interested, wallpaper can sometimes be removed and reused by the seller, Lagrange says.
  3. Be willing to part with the paper. Big-personality wallpapers can be exciting in small doses, such as accent walls. But not everyone will agree. A seller should be ready to remove wallpaper if a buyer isn't wild about it.
  4. Get real. If wallpaper looks worn, dirty or ripped and can't be repaired, sellers need to remove it rather than have it become an eyesore during showings – no matter how much they love it, she says.

Source: Wallpaper Makes Triumphant Return, Realtor® Magazine

© Copyright 2019 INFORMATION INC., Bethesda, MD (301) 215-4688

Feb. 14, 2019

Alone on Valentine’s Day? Buy a house and find true love!

SANTA CLARA, Calif. – Feb. 13, 2019 – Owning a home might make you more attractive to that special someone you've had your eye on, especially if they are a millennial or a woman.

According to a realtor.com study, singles looking to boost their chances of dating a homeowner may want to considering living in the South or in the Midwest because they are home to the biggest shares of single female and male homeowners, respectively, according to the analysis.

"Attractiveness is in the eye of the beholder, and this survey data suggests that many beholders find homeownership attractive, perhaps using it as a signal for financial savviness and success," says Danielle Hale, realtor.com's chief economist. "Single millennials seem to find homeownership in a potential partner especially attractive."

The survey, which included 500 people who identified as single and was conducted in late January, found that 46 percent of all singles thought homeownership made a potential partner attractive or very attractive. Women were more likely than men to agree with this, as 48 percent of women found it made a potential partner more attractive, versus 43 percent of men.

Men, however, were slightly more likely to say that it made their potential partner very attractive.

The survey also asked singles how important it was for a potential partner to be a homeowner. Similar to before, women were more likely than men to agree it was either important or very important that their partner was a homeowner.

But the gap between genders was wider than when asking about attractiveness of homeowners, coming in at 29 and 19 percent for women and men, respectively.

As a whole, 24 percent of single respondents felt it was important for their partner to be a homeowner.

Millennials show strong desire for homeownership
Millennials were the most likely to feel that homeownership boosted someone's attractiveness, with nearly 60 percent of the generation agreeing with the statement. Millennials also were the generation most likely to agree that it was either important or very important for their partner to be a homeowner, as indicated by 26 percent.

Single male homeownership highest in Midwest
For those looking to find a potential home-owning male partner, the Midwest is going to be the best bet. The market with the greatest share of single male homeowners is Detroit, where they make up 23.4 percent of all males. It was followed by St. Louis with 21.3 percent, Minneapolis with 21.3 percent, Cleveland with 21.2 percent, and Pittsburgh with 19.9 percent.

Single female homeownership strong in South and Midwest
Single women are one of the fastest growing demographics in the housing market, according to a recent realtor.com analysis. This trend can be seen strongest in Detroit, where single women homeowners make up 23.1 percent of all women, followed by 21.4 percent in Baltimore, 21.2 percent in Charlotte, N.C., 20.7 percent in Philadelphia and 20.7 percent in Minneapolis.

© 2019 Florida Realtors®

Feb. 13, 2019

Florida's housing market: Sales, new listings, median price up at end of 2018

ORLANDO, Fla. – Feb. 12, 2019 – Florida's housing market wrapped up 2018 with more sales, higher median sale prices and more new listings compared to the year before, according to the latest housing data released by Florida Realtors®.

"Florida's economy is growing, the jobs outlook remains strong and more people are moving to the Sunshine State," says 2019 Florida Realtors President Eric Sain, . "And, while mortgage interest rates have fluctuated in recent months, they remain at historically low levels. All of these factors are positive signs for the state's housing market in 2019."

Year-end 2018

Statewide closed sales of existing single-family homes totaled 277,827 in 2018, up 2.2 percent compared to the 2017 figure, according to data from Florida Realtors research department in partnership with local Realtor boards/associations.

The statewide median sales price for single-family existing homes in 2018 was $254,505, up 7.2 percent from the previous year. New listings for existing single-family homes rose 6.5 percent in 2018 compared to 2017.

Looking at Florida's year-to-year comparison for sales of townhouse-condos, a total of 116,706 units sold statewide in 2018, up 4.9 percent from 2017. The closed sales data reflected fewer short sales and foreclosures statewide in 2018 compared to the previous year: Short sales for condo-townhouse properties declined 37.5 percent and foreclosures dropped 33.9 percent; short sales for single-family homes dropped 41.4 percent while foreclosures declined 39.5 percent.

The statewide median price for townhouse-condo properties in 2018 was $185,000, up 7.2 percent over the previous year. New listings for townhouse-condos for the year increased 5.9 percent compared to a year ago.

At the end of 2018 and also for 4Q 2018, inventory for single-family homes stood at a 4-months' supply, while inventory for townhouse-condo properties was at a 5.7-months' supply, according to Florida Realtors.

Florida Realtors Chief Economist Dr. Brad O'Connor said Florida's housing data shows that statewide inventory (active listings) is up, comparing year end 2018 to year end 2017.

"It's not a significantly huge increase – active inventory is up 13.3 percent in single-family homes and up 8 percent in condo-townhome properties," he said.

More inventory could help spark sales, bringing back potential buyers who have been waiting on the sidelines.

O'Connor added, "The national housing market forecast (from the National Association of Realtors) for 2019 expects flat growth, in both the condo and single-family categories. Currently, in our Florida forecast model, we're outpacing the nation in sales and employment growth, so our outlook is probably about 1 percent growth in sales and maybe 3 to 4 percent price growth. Relative to all other areas of the nation, we think Florida is doing really well."

The interest rate for a 30-year fixed-rate mortgage averaged 4.54 percent for 2018, up significantly from the previous year's average of 3.99 percent, according to Freddie Mac.

4Q 2018

Statewide closed sales of existing single-family homes totaled 63,483 in the fourth quarter of 2018, up 0.1 percent compared to the year-ago figure, according to data from Florida Realtors research department in partnership with local Realtor boards/associations. Closed sales typically occur 30 to 90 days after sales contracts are written.

The statewide median sales price for existing single-family homes for the quarter was $255,000, up 6.3 percent from 4Q 2017. New listings for existing single-family homes for the quarter rose 5 percent compared to a year ago.

Looking at Florida's year-to-year comparison for sales of condos-townhouses, a total of 26,069 units sold statewide in 4Q 2018, up 1.9 percent compared to the same period a year earlier. The closed sales data reflected fewer short sales and foreclosures statewide in the fourth quarter compared to the same time a year ago: Short sales for condo-townhouse properties declined 41.2 percent and foreclosures dropped 29.1 percent; short sales for single-family homes dropped 41.6 percent and foreclosures declined 26.5 percent.

The statewide median price for condo-townhouse properties in 4Q 2018 was $184,000, up 5.1 percent over the previous year. New listings for condos-townhouses for the quarter increased 2.9 percent compared to a year ago.

To see the full statewide housing activity reports, go to Florida Realtors Research & Statistics section on floridarealtors.org. Realtors also have access to local market stats (password protected) on Florida Realtors' website.

© 2019 Florida Realtors®  

Feb. 11, 2019

Mortgage rates hit 10-month low

WASHINGTON (AP) – Feb. 7, 2019 – U.S. long-term mortgage rates fell this week to a 10-month low, spurring on potential homebuyers for the upcoming season.

Mortgage buyer Freddie Mac said Thursday the average rate on the benchmark 30-year, fixed-rate mortgage eased to 4.41 percent from 4.46 percent last week. Despite the declines in recent weeks, home borrowing rates are still above last year's levels. The key 30-year rate averaged 4.32 percent a year ago.

The average rate this week for 15-year, fixed-rate loans declined to 3.84 percent from 3.89 percent.

Increases in home prices have slowed in many areas of the country, and more homes have come on the market. Those developments, along with historically low mortgage rates, should give a boost to this spring's home buying season, experts say.

"The U.S. economy remains on solid ground, inflation is contained and the threat of higher short-term rates is fading from view," said Freddie Mac chief economist Sam Khater.

The Federal Reserve held its benchmark interest rate steady last week and sent its strongest signal to date that it sees no need to raise rates anytime soon. Its message ignited a rally on Wall Street, which cheered the prospect of continued modest borrowing rates for the near future.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week.

The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates.

The average fee on 30-year fixed-rate mortgages fell this week to 0.4 point from 0.5 point. The fee on 15-year mortgages held steady at 0.4 point.

The average rate for five-year adjustable-rate mortgages dropped to 3.91 percent from 3.96 percent last week. The fee was unchanged at 0.3 point.

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