Hope you’re having a great start to your week! As we continue to navigate the ever-evolving housing market, I wanted to share a quick update on some key factors influencing things right now.
Last week, interest rates held steady, and Freddie Mac reported the average 30-year fixed-rate mortgage at .30 percent lower than this time last year. It’s encouraging to see some stability, and even a slight year-over-year decrease, which seems to be keeping purchase applications humming along.
The Federal Reserve decided to maintain the current federal funds rate, citing continued solid economic growth and a stable job market. However, they also noted that inflation remains somewhat elevated and that there’s increased uncertainty in the overall economic outlook. They’re keeping a close eye on incoming data to determine the timing of any future rate adjustments.
One significant piece of this uncertainty is the ongoing trade situation with China. The good news is that the US and China are set to meet in Switzerland this Saturday for initial talks. This first step towards de-escalation is crucial, as any clarity on trade could significantly impact inflation and overall economic stability, which in turn affects mortgage rates. The fact that there was strong demand for US debt in a recent Treasury auction is a positive sign of continued confidence in our market.
Looking at this week, all eyes are on the Consumer Price Index (CPI) Report. While current inflation rates are the lowest in nearly four years, they’re still above the Fed’s 2% target. Fortunately, numbers came in a little below expectations, easing inflation worries, but so far having little effect on mortgage rates this week.
Also, this week we’ll see the report on wholesale price inflation, which is actually predicted to show a year-over-year decline from 2.7 percent to 2.4 percent, which would be a welcome sight. We’ll have to wait and see!
On another note, a recent report highlighted an interesting trend: the median age of homes purchased in the US has reached a record high of 36 years. This shift reflects the ongoing challenges with new construction and housing affordability, leading buyers to consider older properties. While these homes may come with a lower price tag, they often require renovations and updates. This trend actually presents a fantastic opportunity to explore renovation loan products, like the 203(k) loan, which can help buyers finance both the purchase and the necessary improvements.
Whether you’re a current homeowner, a prospective buyer, or a valued referral partner, understanding these market dynamics is key. Please don’t hesitate to reach out if you have any questions or want to discuss your specific situation. I’m always here to help you navigate the market and find the best solutions for your needs. Reach out now by simply hitting reply to this email, or you can call or text me at 818.307.6072.
