This week's market trends & insights
June 16th, 2023
Dreams / Reality
With higher mortgage rates, high home prices, and a limited supply of homes for sale, the market can be pretty dispiriting right now for first-time buyers or upgraders. But don't give up! Owning a home provides comfort, security and builds long-term wealth. The right home is out there, and I can help you find it and obtain financing. Let's talk about your options and put together a plan!
A Pause?
Both producer price inflation (PPI = +1.1% in May) and consumer price inflation (CPI = +4.0% in May) are tumbling down. That gave the Fed the wiggle room to 'skip' a rate hike on June 14. But Fed commentary and forecasts suggest that another 1-2 rate hikes could be in the near future if "core" inflation (currently +5.3%) doesn't get down closer to their 2.0% target quickly.
Unlucky #7
For the 4th time in 9 months, average 30-yr mortgage rates have moved near or above 7%. This despite: 1) major progress on taming inflation, and 2) the Fed 'skipping' a rate hike after 10 straight hikes of 500 bps in total. The bond market is behaving strangely, but as inflation fades further in the 2H of 2023, the strong relationship between inflation and interest rates will reassert itself and mortgage rates will drop.
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