Wow. Freddie Mac is reporting that as of last week’s survey of average mortgage rates, the rates have dropped enough since November that as many as 3 million more home buyers can qualify for and afford a median $400,000 mortgage!
Since that report, however, there’s been increased volatility in markets and rates thanks to two major events last week. One, the Fed Meeting last week resulted in an as-expected rate hike, which normally would not cause rate volatility. However, the Fed Chairman’s remarks were interpreted to mean the Fed may be changing course sooner than originally said and bonds rallied as a result, pushing mortgage rates higher.
Then, on Friday (the 2nd major event) we saw a surprising Jobs Report come out. January’s jobs report revealed that 517k jobs were created to start the year, almost 3X what the analysts had predicted! The unemployment rate dropped too, to 3.4 percent, showing a much stronger economy than some expected.
And in the housing market…
For home buyers, Realtor.com’s latest report shows buyers regaining the upper hand in the housing market as mortgage rates improve and inventory becomes more plentiful. In January, the number of homes for sale grew 65.5 percent for the year with metros like Nashville, Austin, and Raleigh, NC seeing the largest increase in inventory.
The Realtor.com report also says, the median home list price remains at $400,000 for January, which is only a slight change from December. However, the number of homes with price reductions has increased to 15.3 percent year over year. The number of days that homes are on the market is also increasing.
And finally, I want to share the latest analysis from the National Association of Home Builders, which says that for them, all signs are pointing to a turning point for the second half of the year for the housing market and the economy in the U.S. Their chief economist says elevated inflation and higher mortgage rates coupled with high building material cost put a damper on the housing market but that they are predicting a turnaround of this trend for the second half of 2023.
The above is just some of the evidence that the housing market is becoming increasingly favorable for buyers, so if you’ve been waiting to make a move, now may be the time to put together your plan. And of course, I’m happy to go over all of your financing scenarios. Please reach out anytime at 818.307.6072 (call or text) or reply to this email and your message comes directly to me.
