Close Menu


    Stock

    Another pause in the discounts in federal interest rates may disappoint homes

    msmarkBy No Comments4 Mins Read

    When mortgage rates increased from 3.5 % to nearly 7 % in 2022, the housing boom in the Kofid era was raised to a sudden end. Sustainable high rates have led to the freezing of the market, making home ownership warmer for buyers and sellers inhibitors of real estate listing.

    Many potential buyers have chosen to delay the purchase of a house until the rates decrease to a more acceptable level, making financial commitment more at reasonable prices.

    🏦 🏡 Do not miss this step: Subscribe to the free daily newsletter of Thestreeet 🏦 🏡

    Although the rate of federal funds is not the main determinant of mortgage rates, it affects borrowing costs, which are factors in mortgage rates. Low interest rates also improve consumer confidence and increase home buyer confidence.

    The Federal Reserve kept interest rates in each meeting this year, and the central bank stuck to the same strategy at the Board of Governors yesterday. House buyers who are waiting for a boost in the housing market or a decrease in the mortgage rate may have to wait for the next Federal Reserve meeting in June.

    Jerome Powell, President of the Federal Reserve, Jerome Powell, is not another procedure onInterest rate discountsIt will be taken until there is enough economic data to support it.

    Photo and colon source; Gety pictures

    The home buyers pay close attention to the federal reserve movements, interest rates and mortgage rates

    The housing market has been stagnant over the past few years, as buyers and sellers are waiting for the mortgage prices to decrease.

    in spite of Federal funds rate Do not directly constitute mortgage rates, 10 years of return treasury No, it tends to decrease in anticipation of the reduction in the interest rate of the Federal Reserve.

    It was widely believed that the Federal Reserve would carry fixed interest rates at its current level between 4.25 % and 4.50 % at the May Council meeting. However, the buyers of the younger houses who hope for relief in the housing market – and will continue to monitor the FBI’s movements closely during the remaining period of the year.

    More about home:

    Until October 2024, real estate mortgage rates reflected the rate of federal fundsThis means that reducing the interest rate is likely to mean a decrease in the mortgage rate.

    However, stubborn mortgage rates were not greatly affected due to the interest cuts at the Federal Reserve Bank last year, broke with his historical tendencies and the smoothness of the feelings of housing buyers.

    There may be hope on the horizon for home buyers in the third quarter. Although the Federal Reserve will likely retain prices again at the June meeting, CME Fedwatch expects 51.1 % chance The Federal Reserve will reduce prices in July and make another possible price reduction in September.

    Younger buyers are more specific about the housing market conditions

    The buyers of the younger houses have faced the troubled housing market over the past five years. Continuous fluctuations in the mortgage rate, prices and supply have made it difficult to find the right time to buy a house.

    Now, young generations have become afraid to buy a house in these circumstances. the The real financial progress index BMO I found that 69 % of the Gen Z and 74 % of the millennial tenants are waiting for the mortgage prices to decrease before buying a house.

    Related: Morgan Stanley predicts the major mortgage rate changes soon

    Real estate mortgage rates and the general lack of costs are still a great concern for the younger house buyers, which causes many to delay the ownership of homes for years. Mediator The age of the home buyer for the first time was 38 Last year, the highest level ever.

    BMO heads of US economists explain that although the housing market conditions are not perfect, they can soon turn, and financial preparation will be essential.

    He said: “It was rarely the financial obstacles to own a higher house, especially for small families who have not yet reached their feet in the door.” “Poor ability to afford housing, limited stocks for current homes, and high interest rates makes finding the right house that suits your budget is a difficult endeavor.”

    “The good news is that economic and financial conditions can change quickly, so it makes sense to start planning today.”

    Related: The Veteran Fund Director reveals the prediction of the S&P 500

    Share.

    Related Posts