The volatility in rates and financial markets gave us a nice improvement in mortgage rates over the past two weeks. However, now as fears about the banking sector subside somewhat we’ve seen rates move back up again out ahead of an important Fed Announcement this week.
Watching the markets over this last week is a great reminder that if you or anyone you know is planning a home purchase or refinance, please reach out to me and I can keep an eye on rates for you and advise you when we see these dips. You can save lots of money on interest when the rates change even a little bit!
As for this week, we saw the Existing Home Sales numbers jump 14.5 percent posting the largest increase since July 2020 and beating expectations after last month’s pullback in sales. The report released by the National Association of Realtors also revealed that the median price of an existing home decreased by 0.2 percent compared to a year ago ending 131 straight months of increases.
New Home Sales numbers come out on Thursday and after surging to a 670,000 annual rate in January, new home sales in February are expected to fall back to 645,000.
On Tuesday the highly anticipated two-day Fed Meeting got underway. The Fed Chair will hold a press conference on Wednesday afternoon discussing their policy decision and it’s likely to have a sizable impact on markets. Current expectations are for a .25 percent hike in the Fed Funds Rate. Even if the members decide to stick to their plan for a .25 percent increase, Chairman Powell’s comments following the announcement about their future plans could cause large swings in the markets and even mortgage rates.
So, what will the Spring Homebuying Season look like?
I’ve been seeing lots of competing headlines and data on this topic and as we know, only time will tell for sure. Here’s what I’m seeing:
• New listings of homes for sale have been low, contributing to a low supply of homes on the market.
• Sales activity has slowed due to rising interest rates and seasonality
• Homeowners that don’t have to sell, due to a move or life change, are holding on to their homes.
• Attractive homes that are well-priced are easily and quickly finding buyers. In February the median was 17 days, significantly less than the pre-pandemic.
• The home market is not as frenzied as we saw over the last couple of years.
• Home sales are picking up but not by as much as “usual.”
• Homebuilders are picking up many of the buyers that would have bought an existing home. They’ve been building like crazy since 2020 and are motivated to sell.
The bottom line here is…it’s likely mortgage rates will continue to be volatile so between the opportunities in housing availability and jumping on improving rates, if you’re considering a move, let’s come up with a plan for you to get the best scenario possible. Reach out to me to discuss!
