Hey there! Hope you’re having a great week! It’s been a volatile week in housing and financial markets, and this past week brought some interesting developments.
You might have noticed a slight uptick in interest rates recently, with the 30-year fixed rate averaging around .05 percent higher according to Freddie Mac. While this is up a bit from last week, it’s still notably lower than a year ago! This shift is partly due to positive global news, like a U.S.-China trade pause and potential peace talks between Russia and Ukraine, which have encouraged a “risk-on” environment. This means money is moving into assets like stocks, leading to a modest rise in bond yields, which influence mortgage rates.
The good news continues on the inflation front, with the Consumer Price Index hitting a four-year low of 2.3%. This typically supports lower rates, but the overall economic optimism has kept the Federal Reserve on hold for now, with their next potential rate cut likely pushed to July.
Despite the small rate increase, we’re seeing some exciting trends in the housing market. Mortgage applications are up, especially for home purchases, climbing 18% year-over-year! This is largely thanks to a growing inventory of homes for sale, giving buyers more options – a welcome change from the past couple of years.
The bottom line? While we’re seeing some rate volatility day-to-day, the overall picture is positive. A recession seems less likely, and increased inventory is fueling buyer demand. We’ll be watching tariff negotiations and any new tax bill discussions closely next week.
As always, I’m here to answer your questions and help you navigate your home financing needs. Don’t hesitate to reach out! You can always send me an email or text/call me at 818.307.6072.
Have a great rest of your week and a Happy Memorial Day Weekend!
