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Mortgage rates stabilize at 6.65% as housing activity slows. See what this means for buyers, seller concessions, and negotiating opportunities.

Mortgage Rates Stabilize as Housing Activity Slows

Mortgage rates improved modestly for the second consecutive week.

Freddie Mac reported that the national average 30-year fixed mortgage fell to 6.65% on August 20, down from 6.67% the prior week and 6.69% on August 6. The 15-year fixed average declined to 5.95%.

The improvement isn't dramatic, but it does suggest the steady upward move we experienced through July has paused.

Meanwhile, housing activity continues to slow.

Existing-home sales declined 1.7% in July to an annualized pace of 4.06 million homes. Pending sales fell another 2.3%, reaching their lowest level since January.

Builders are showing caution as well. July housing starts fell 12.4% from June, including a 9.9% decline in single-family starts.

Interestingly, building permits increased 5.0%, suggesting builders are still planning future projects even while slowing the pace of actual construction.

For buyers, this combination creates an interesting environment.

Affordability remains difficult because home prices and mortgage rates are elevated. But slower demand can also create negotiating opportunities.

One of the most important negotiations involves seller concessions.

Suppose a seller is willing to give a buyer $10,000.

The buyer could potentially negotiate a lower purchase price or use eligible seller funds toward allowable closing costs.

At a 6.5% 30-year fixed rate, financing an additional $10,000 costs approximately $63 per month in principal and interest.

That doesn't mean seller concessions are automatically superior.

A lower purchase price reduces the amount financed and long-term interest expense. Closing-cost assistance, however, may allow the buyer to preserve thousands of dollars of cash.

The correct answer depends on the buyer's financial situation, loan program, appraisal, concession limits, mortgage insurance, qualification, and expected ownership period.

That's why buyers should compare transactions instead of making decisions based solely on purchase price or interest rate.

The best mortgage strategy is usually found by examining the entire financial picture.

What Does This Mean for You?

Mortgage rates have eased slightly, but the bigger story is what’s happening with housing activity.

Sales and pending contracts are slowing. Builders are pulling back. And while affordability is still tough, slower demand could give buyers more room to negotiate.

One area worth paying attention to? Seller concessions.

If a seller is willing to give you $10,000, that money could potentially be used toward eligible closing costs instead of simply lowering the purchase price.

But there’s no one-size-fits-all answer.

The better move is to compare the numbers — purchase price, payment, cash needed at closing, loan program, mortgage insurance and how long you plan to own the home.

Don’t just ask, “What’s the rate?” Ask, “What’s the smartest overall deal for me?”

If you’re thinking about buying and want to see what the numbers actually look like for your situation, let’s have a conversation.

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