October 2020 Market Forecast
As the housing market now enters fall, homebuyers continue to wade through unprecedented times. Due to low inventory and low mortgage rates, the seller's market still dominates. This is typically when home sales start to slow down, but the numbers are telling a different story.
US Weekly Average Rates as of 9/29 – Freddie Mac
Week of | 1 Year Ago | 4 Weeks Ago | |
30-Year Fixed-Rate Mortgage | 2.9% | 3.65% | 2.93% |
15-Year Fixed Rate Mortgage | 2.4% | 3.14% | 2.42% |
5/1-Year ARM | 2.9% | 3.38% | 2.93% |
Demand stays hot
- Average mortgage rates are hanging below 3%.
- Federal Reserve is holding firm with no rate hikes projected through 2023, but this could change.
- According to Realtor.com's August 2020 monthly housing trends report, homes are lasting fewer days on the market than they were at this time last year, despite higher price tags.
Recovery could be underway
- Fannie Mae's Home Purchase Sentiment Index® (HPSI) increased to its highest level since March in August, reflecting a rise in confidence among buyers and sellers.
- Strong real estate sales going into October indicate a potentially strong fall where numbers typically wind down.
Buyers are shifting their preferences
- New construction has become a new creative solution for eager buyers, including first-time homebuyers.
- Many buyers are now seeking spaces with home offices to fit their new work-from-home lifestyle.
- More affordable cities are becoming increasingly attractive for homebuyers.