HUD Articles
A look at this week's market
August 07, 2023
With the recent spike in mortgage rates it has created a so-called golden handcuff effect. Nearly 80%+ of homeowners feel “locked-in” by their existing low-rate mortgage. As a result, there is a shortage of home sales which continues to drive up sales prices.
Most homeowners today have mortgages with interest rates below 4% or even below 3% in some cases.
Zillow found that consumers would be twice as likely to sell their home if their current mortgage rate was higher than 5%. Unfortunately, 80% of homeowners have an interest rate of 5% or less.
As inflation continues to decline, interest rates will decrease, inventory will increase, and new buyers will enter the market.
This Week:
This week is the big one because it revolves around inflation. Expectations are to see an increase year-over-year. When inflation increases it increases the cost of goods and services. It also becomes more expensive for lenders to lend out money, which directly impacts mortgage rates.
08/10 – Inflation Rate YoY: 3.3% expected
08/10 – Initial Jobless Claims: 229k expected
08/10 – Continuing Claims: 1710k expected
08/11 – PPI MoM: +0.2% expected
08/11 – Consumer Sentiment: 71 expected
