Step Inside The Market - Week 24, 2023

StepInside Market Weekly 6/16

Hello Everyone!

In this week’s recap, we will focus on the current trends within the residential real estate market, and a few updates from the most recent Fed Meeting:

🔥 After the news broke that the Fed was “skipping” a hike in rates, mortgage rates lowered and applications soared!

• As the 10 year treasury yields decreased after the announcement, the average 30-year fixed rate for many Americans is hovering around 6.7%. While this is still about 1% higher than the same time last year, we continue to see rates come off highs of over 7% earlier this month

• Refinance applications rose by 6%, while purchase applications were up by 8%

🤔 During the Fed press conference, Chairman Jerome Powell spoke about the mortgage market. He emphasized just how vital swings in rates are to the market, but signaled that they believe the market is at the bottom and should be going up over time. However, they will continue to keep a close eye on the market movements and the impact future rate hikes may have on it.

❗While the Fed announcements may have been positive for rates and applications, the overall market is still very lethargic. It is estimated that the market needs in excess of 300,000 affordable homes for middle income buyers, which constitutes only a percentage of overall needs.

🙃 Housing costs remain stubbornly inflated due to low inventory across buying and renting options. However, many economists believe we may be in for some relief during the second half of the year. While the relief will mainly be felt by renters, it should help new home buyers as well.