Mortgage rates tumbling: Time to buy or refinance

If you haven’t heard, mortgage rates are tumbling.  The average rate on the 30-year fixed has fallen to 3.94%, according to Mortgage News Daily.

Not only has this spurred many to refinance, the falling rates are also benefiting buyers in Jersey City, especially as home prices are now cooling. Affordability is now the best it’s been in more than a year, with the monthly payment on the average-priced house down 6% in the past six months (that’s with a 20% down payment). 

“When we factor income into the equation, we see that it takes 22% of the median income to purchase the average-priced home. That’s the lowest payment-to-income ratio in more than a year as well, and far below the long-term average of 25.1%,” wrote Ben Graboske, president of Black Knight’s data and analytics division.

While the price gains have leveled off, it is still difficult for first time home buyers to afford a home. Although falling mortgage rates may help, there is still a lack of lower-priced, entry-level homes.