Housing Bubble
Mortgage rates and average home prices fall in October
Washington, D.C. - The Federal Housing Finance Board today reported that the national average one-family house purchase price in October was $235,700. By way of comparison, the October 2001 national average home price was $219,600 and $200,800 in October 2000. Both Fannie Mae and Freddie Mac use the percentage change in this October average price to adjust each year the maximum size of mortgage loans that they can purchase (the conforming loan limit). The average house purchase price decreased by $1,900 since September.
The average house price is based on a monthly survey of major lenders that are asked to report the terms and conditions on all conventional, single-family, fully amortized, purchase-money loans closed during the last five working days of the month. FHA-insured and VA guaranteed mortgages, refinancing loans, and balloon loans are excluded from the data.
The average interest rate on conventional 30-year, fixed-rate mortgage loans decreased 13 basis points to 6.23 percent during October. The average interest rate on 15-year, fixed-rate loans was 6.05 percent during October, down from 6.30 percent in September.
The contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) decreased 14 basis points to 6.08 percent. The effective interest rate also decreased 14 basis points to 6.14 percent. The average contract rate on fixed-rate mortgages decreased 16 basis points to 6.20 percent, while the average contract rate on adjustable-rate mortgages (ARMs) decreased eight basis points to 5.31 percent.
Initial fees and charges were 0.40 percent
of the loan balance in October, down from 0.45 percent in September
while the average term was 26.7 years in October, down from 27.3 years
in September. The average loan amount decreased by $3,500 to $161,000
in October.
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