Thursday saw a significant surge in US mortgage rates, with the 30-year fixed-rate jumping to 7.49%, according to Freddie Mac's chief economist, Sam Khater. This hike represents a marked increase from last week's rate of 7.31% and a substantial rise from last year's rate of 6.66%. Influences behind this surge include the Federal Reserve's uncertain actions and an ongoing campaign to curb inflation.
The Primary Mortgage Market Survey by Freddie Mac, which focuses on borrowers with excellent credit making a 20% down payment, also recorded a notable year-over-year increase in the 15-year fixed-rate mortgage, which now stands at 6.78%. This rise has been affected by the climbing 10-year Treasury yield.
The impact of these rising rates on the housing market is significant, with the National Association of Realtors reporting a more than 20% decline in the pace of home sales due to rising rates and a historically low inventory of homes for sale.
Freddie Mac, which has facilitated home ownership for millions since 1970, continues its mission of promoting housing affordability and stability in these challenging times. The organization's findings are communicated through media contact Angela Waugaman and are further underscored by a photo release and robust social media engagement.
Freddie Mac's recent performance has shown a strong return over the last three months, as per InvestingPro Tips. Despite a declining trend in earnings per share, the company's net income is expected to grow this year. This is a positive signal for investors, especially those who are interested in the company's future performance. However, it's crucial to note that the stock generally trades with high price volatility, which might be a significant consideration for risk-averse investors.
Looking at the company's real-time metrics provided by InvestingPro, Freddie Mac's market cap stands at 1740M USD, with a P/E ratio of 75. The company's revenue for LTM2023.Q2 is 17.95B USD, indicating a strong financial position. However, the company's revenue growth for the same period shows a decrease of 20.91%, which might be a point of concern for investors.
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