According to Bankrate and Freddie Mac, the current average interest rate for a 30-year-fixed mortgage is 7.58%, which is the highest it has been in over 20 years. Experts are now predicting that this could go up to 8%, if the economy continues to show signs of strength and the Federal Reserve raises interest rates again. If this happens, the housing market could go back into a deep freeze.
Home sales in Atlanta ↓14.9% MoM, amounting to 4,896 properties sold.
Sales volume measured at $2.37B, ↓ 17.4% MoM.
Lenders have guidelines regarding max DTI to approve a loan.
Many lendaers allow for DTI ratios up to 50%.
Still, loans with higher DTI ratios typically have worse terms.
Higher DTI may require a higher down payment to meet loan approval criteria.
U.S. mortgage rates are inching closer to 8%, a two-decade high, making homeownership increasingly out of reach for many Americans. The Federal Reserve's aggressive tightening campaign against inflation is causing upward pressure on market rates, making existing home sales slump further and potential first-time borrowers hesitant. Lawrence Yun, chief economist at the National Association of Realtors, believes mortgage rates could go higher than 8%, but also that the current high may be the peak before it retreats. In contrast, mortgage rates averaged 16.63% in the past. Perry Johnson, a Republican presidential candidate, filed a complaint with the
According to Bankrate and Freddie Mac, the current average interest rate for a 30-year-fixed mortgage is 7.58%, which is the highest it has been in over 20 years. Experts are now predicting that this could go up to 8%, if the economy continues to show signs of strength and the Federal Reserve raises interest rates again. If this happens, the housing market could go back into a deep freeze.
It turns out that sellers could win big with such low housing inventory.
Home sales in Atlanta ↓14.9% MoM, amounting to 4,896 properties sold.
Sales volume measured at $2.37B, ↓ 17.4% MoM.
Georgia home prices show significant upward trajectory, reflecting robust demand and limited inventory.
So you’ve undoubtedly seen some news concerning inflation and mortgage rates, as well as something about a Federal Reserve (the Fed) decision. You may be wondering what it all means for you, especially if you’re considering purchasing a home. Allow me to break it down for you.
The Fed is working really hard to reduce inflation. Even if the most recent figures show modest improvement, the inflation rate remains above the 2% target. One of the reasons the Fed chose to raise the Federal Rate again was because of this. According to Bankrate, the Fed has hiked interest rates for the tenth time in ten meetings to combat inflation and cool the economy, which has been growing since rebounding from the 2020 coronavirus recession.
The Fed’s activities do not directly affect mortgage rates, but they do have an impact. Their actions last year contributed to a purposeful downturn in the residential real estate market.
Everyday expenses, such as gas and groceries, are becoming more expensive as a result of high inflation. You’ve probably already observed this, especially at the Grocery store!! The Fed is attempting to reduce inflation by hiking the Federal Funds Rate. If they are successful, it may result in lower mortgage rates, making house ownership more accessible for you. This is because when inflation is high, so are mortgage rates. Experts predict that if inflation slows, mortgage rates will follow suit.
The problem is that Biden’s Administration has gone after America’s fossil fuel production. Here at Complete Realty Team we are all for having a cleaner planet, but it will take time to do so. We can’t stop our dependence on fossil fuels overnight. It takes energy to produce everything from the clothes on your back to the food on your table!
Inflation and mortgage rates will continue to have an impact on the housing market in the future. According to Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), mortgage rates will likely fall later this year as consumer price inflation moderates. Mortgage Bankers Association (MBA) Chief Economist Mike Fratantoni concurs, predicting that mortgage rates will fall this year as the economy slows.
Nobody knows what will happen to mortgage rates, but analysts believe they will fall this year if inflation falls as well. Connect with a reputable real estate advisor if you want to stay informed. They are aware of what is going on and can assist you in understanding what the experts are predicting and how it may affect your plans to purchase a home.
Don’t be perplexed by the recent Federal Reserve decision. What happens to mortgage rates is determined by the rate of inflation. Mortgage rates will fall if inflation cools off, but will go up if inflation continues.
Our take – rates are probably going to go up with the Fed already hinting at raising rates at least one more time this year. The last stat we saw is that inflation was at 3.2% with their target being 2%.
If you have questions, want to know your home’s value or to buy or sell a house, just visit Complete Realty Team or give us a call at (404) 410-6465. You can also go here to get more real estate news VIDEOS.
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