As we head into the long holiday weekend, I wanted to share some encouraging news. We have seen some welcome relief in the market recently, with mortgage rates trending down toward their lowest levels since mid-May.
A big driver behind this shift is the steady decline in energy prices. Crude oil has fallen back toward the $70 per barrel mark, and diesel prices are nearing their lowest levels since 2021. Lower energy costs act as a natural brake on inflation, which takes some pressure off the Federal Reserve and helps sustain this downward trend in mortgage rates. While we did see a minor, short-term rate bump yesterday due to typical end-of-quarter bond trading, the broader, multi-week trajectory remains very consumer-friendly.
On the housing front, Congress just passed a major legislative package focused on long-term supply and affordability. More inventory means a healthier, more balanced market for everyone. We are already seeing signs of this stabilization. According to recent data from Realtor.com, national asking prices fell 2.5% year over year, marking the largest drop since 2017. Sellers are pricing realistically right out of the gate rather than chasing the market down, and buyers are responding, driving pending sales up for a seventh consecutive month.
However, we are definitely seeing a “two Americas” housing market right now. In the West and South, affordability pressures are easing as prices adjust. Meanwhile, the Midwest and Northeast remain highly competitive due to tighter inventory, and a recent Redfin report notes that nationwide new listings actually dipped to their lowest levels since February. For buyers in tighter markets, remember that negotiation leverage is back. Nearly half of sellers are offering concessions, and inspection contingencies are being used effectively to secure repair credits.
Looking to the future, the housing market is proving remarkably resilient. This shortened holiday week brings a wave of crucial labor data, including the June employment report, which will heavily influence where rates go next.
Whether you are looking to buy, thinking about refinancing, or helping your own clients navigate these shifts, I am always here to help you make sense of it all. You’re always welcome to reach out to me by sending me an email or calling/texting 818.307.6072.
