SAN DIEGO (KGTV) – U.S. mortgage rates have fallen below 6%, the lowest it’s been in September 2022.
“Since 1971 until today, the average rate is 7.69%. It's kind of hard to believe that,” Dan Sirota, the owner of Brookeshire Real Estate, said. “So below 6% in the 5's sounds like it's OK, but it's actually a really good rate.”
ABC 10News spoke with him in one of his properties in Mission Valley about what U.S. mortgage rates dropping below 6 percent means for those who want to buy.
“This is positive right now. So, for buying power, just to give you an example, at a million-dollar purchase, the rates dropping below 60 in the high fives saves about $550 to $600 per month, which is great for buying power,” Sirota said.
Data from the Federal Reserve of St. Louis shows that as of January, there are nearly 4,000 homes listed in San Diego County.
“One thing that's hurt the supply in the housing market is that people don't want to sell their house that has a really low mortgage interest rate attached to it and then buy another house where you have to pay these, these high rates,” Alan Gin from Knauss School of Business at the University of San Diego said. “And so that narrows the gap a little bit. And so, it should lead to some improvement in that area.”
Redfin, the real estate website, shows in San Diego that there were 569 homes sold in January this year, down from 637 last year.
“There's a lot of sellers that are sitting on 3% mortgages that haven't been able to move. So lowering the rates gives them the opportunity as well to consider moving up or moving on,” Sirota said.
While the dropping of mortgage rates is a welcome sight, Sirota told ABC 10News the spring housing market is about to pick up.
“It also creates lots of different buyers, and that can cause prices to go up, which is you could save on the mortgage rates being lower, but as prices go up, it kind of evens out a little bit,” Sirota said.
