According to Mortgage News Daily, the average 30-year fixed mortgage rate hit 7.29 percent on Wednesday, the highest reading since November.
Inputs that matter: This increase reflects the concern that the Federal Reserve will delay much-anticipated interest rate cuts forecasted in 2023.
- "Mortgage rates have been drifting higher for most of the year due to sustained inflation and the reevaluation of the Federal Reserve's monetary policy path," said Sam Khater, Freddie Mac's chief economist to CNN.
- Mortgage rates track the benchmark yield on the 10-year US Treasury note, which moves in anticipation of the Fed's decisions.
- MarketWatch reports, "Oil appears to play a major role in this week's rise of the benchmark 10-year Treasury yield."
- "Much of that move is due to rising oil prices, a factor to which the breakevens are particularly responsive," noted John Velis, an Americas macro strategist for BNY Mellon.
The opportunity: Yahoo! Finance reports, "The average sales price for houses sold in the country was $492,300, as of the fourth quarter of last year."
- Amazon sells a 19 x 20-foot home that is ready for power and water for less than $20,000.
- This move is reminiscent of the Sears mail-order homes available from 1908 to 1942, in which they sold tens of thousands.
Zoom in: Yahoo! Finance declares that a slowdown in home prices is expected during 2024.
- This is due to rising interest rates, an increase in supply, and a decrease in demand.
Between the lines: Somewhere between buying a home alone and a tiny house is the new "buying with friends" option.
- Fox Business reports, "Kristina Modares and Stephanie Douglass are co-founders of Open House in Austin, Texas. They work to help people purchase their first home — with friends."
- When first-time home buyers face large mortgage payments, buying a home with a group of friends reduces the burden.
- "People are shocked about buying with friends, but I think it will be normal in the next five years," Modares predicted.
Follow the money: Mortgage rates and construction costs are tightly connected with oil prices.
- Federal Reserve Bank Chair Jerome Powell expressed concern about inflation with the rising oil price and is expected to forgo the June rate cuts.
- In addition, part of the home value peak is a result of inflation and is expected to remain.
Go deeper: Subscribe to the free newsletter to learn more.
Read More
- https://thehill.com/business/housing/4585910-mortgage-rates-hit-highest-level-since-november-after-hot-inflation-report/
- https://www.cnn.com/2024/04/11/economy/mortgage-rates-april-11/index.html
- https://finance.yahoo.com/news/amazon-selling-tiny-houses-less-165915624.html
- https://finance.yahoo.com/news/housing-market-2024-home-prices-155502907.html
- https://www.vox.com/the-highlight/24075581/housing-conversions-stripmalls-affordable-supply
- https://www.foxbusiness.com/lifestyle/texas-women-houses-spouses-buy-properties-together-real-estate-expert
- https://banananomics.co/lazy_oil_and_stubborn_inflation
- https://banananomics.co/oil_keeps_rising