Mortgage rates ease on expectations of Fed move

🎉 😬 Happy Friday folks! Today’s newsletter is 634 words, a 2.5-minute read.

1. Mortgage rates ease on expectations of Fed move

Mortgage rates fell last week to their lowest level since April 2023.

The rate on a 30-year fixed mortgage fell slightly to 6.43% in the week ended Aug. 30, according to data released Wednesday by the Mortgage Bankers Association. That marked the fifth decline in as many weeks.

Mortgage rates have fallen recently on expectations that the Federal Reserve will begin cutting interest rates at its next meeting in two weeks.

2. Mortgage applications increase by 1.6%

Total mortgage application volume increased by 1.6% last week, according to the Mortgage Bankers Association.

Refinancing applications saw a slight 0.3% drop for the week but are up 94% compared to last year.

Meanwhile, mortgage applications for home purchases rose 3% last week but remain 4% lower than the same period a year ago, as high home prices continue to deter buyers. Government-backed FHA and VA loans led the increase.

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3. More Nuggets

🏘️ How Gen Z outpaces past generations in the homeownership race. (Youtube CNBC)

🔏 LL Flooring is shutting down, closing all stores nationwide. (KTLA)

📊 Lowest rates in a year and a half. Today’s jobs report could take them even lower (or cause a big bounce). (MND)

🏚️ The housing crisis isn't just a U.S. thing. (Axios)

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4. LoanStream Mortgage acquires HomeStar Financial

OCMBC, operating as LoanStream Mortgage, has acquired HomeStar Financial Corp., expanding its national footprint. The acquisition was finalized on August 29, though financial details were not disclosed.

OCMBC posted $3.56 billion in wholesale volume in 2023, ranking as the fifth-largest wholesale lender. HomeStar had ceased its retail operations in late 2023 due to rising interest rates and shrinking profit margins.

The acquisition reflects ongoing consolidation in the mortgage industry, with over 100 mergers since 2021 as smaller lenders struggle to stay competitive.

5. The average American drops $330,000 on rent before becoming a homeowner

According to a recent study by Self Financial, the typical American renter can expect to pay more than $333,000 during their time as a renter. Here are the key findings from the study:

• The average American can expect to pay $333,065 for a lifetime of renting including bills and additional expenses, or $25,620 per year as a renter from the age of 22 to 35.

• Hawaii residents spend $599,242 on renting over their lifetime, or $46,096 per year — the most of any U.S. state.

• Americans spend an average of $12,145 on moving in and out of rental accommodation during their lifetime.

• Kansas residents pay the least to rent over a lifetime, spending just $238,225, including expenses.

The analysis used Zillow data to calculate median monthly rent and utilities by state, RentCafe data for average utility costs, and Insure’com for renters’ insurance estimates, and assumes people start renting at age 22 and buy their first home at 35, based on National Association of Realtors estimates.

☀️ You’re all caught up. See you on Monday!

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