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Making it in San Diego: Mortgage rates drop to historic lows as peak season approaches

Posted: 5:15 PM, Mar 05, 2020
Updated: 2020-03-06 12:45:52-05
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SAN DIEGO — The economic fallout from the novel coronavirus is leading to increased opportunities to buy a home or refinance one currently owned.

Freddie Mac reported Thursday that the average rate for a 30-year fixed mortgage was 3.29 percent, the lowest in its 50-year history.

That's down from 4.41 percent one year earlier.

With the new, lower rate, a household with a $500,000 mortgage would save about $300 on their monthly payments.

"Anytime there's any sort of any big natural disaster, war threat, that type of thing, the Wall Street money seeks safe havens, and that tends to drive rates down," said Scott Harmes, a senior loan officer at C2 Financial Corp.

Harmes said the phones have been ringing off the hook since the rates fell, including for people inquiring to refinance. He said refinances should be evaluated on a case-by-case basis, depending on how much a household owes, how much longer the loan will last, and how long they plan to stay in their home.

For those in the market to buy, the lower rates come just as San Diego will enter the spring peak homebuying season.

Realtor Michelle Silverman said the higher rates could make the market tighter, but that homes still need to be priced appropriately.

"A seller can't be greedy," said Silverman, of Coldwell Banker. "If you have a greedy seller, the house is going to stay on the market. If the property is priced right, you're going to get multiple offers, maybe even go above list price, and it will move. It will sell."

The rate drop comes after the Federal Reserve lowered its key Federal Funds Rate by 0.5 percent earlier this week in an emergency action.

CoreLogic reports that the median home price in the county was $585,000 in January, up 7.9 percent from one-year earlier.