As 2022 came to a close and we ring in the new year This Week in Real Estate the predictions and expectations for 2023 from pundits were plentiful. The safest forecast is the market/economy will be determined by what happens with inflation. Click below for more on what to expect from the housing market in 2023.
“. . . mortgage rates could pull back meaningfully next year if inflation pressures ease.”
Greg McBride, Chief Financial Analyst at Bankrate
December 6, 2022
The Bureau of Labor Statistics released the November jobs report This Week in Real Estate that far exceeded economists’ expectations. For nearly nine months, the Federal Reserve has relentlessly raised its benchmark interest rate in an effort to slow the U.S. job market and bring inflation under control. And for just as long, the job market has not seemed to get the message. The November employment report that was issued on Friday was no exception. It has proven surprisingly resilient in the face of the Fed’s anti-inflation campaign. Employers added 263,000 jobs and the unemployment rate remained at 3.7%, barely above the half-century low of 3.5%. In the Federal Reserve’s eighth and final meeting of 2022 scheduled for December 13 and 14, it is expected to raise the benchmark interest rate by another 50 basis points or 0.5 percentage point. That would represent the seventh rate increase this year, but the smallest increase of the previous four that were 75 basis points each. While the benchmark rate does not directly impact mortgage interest rates, the bond market does react to the tactics and strategies implemented to curb inflation and the bond market directly influences mortgage interest rates.
“Rates are still more than double those of a year ago,” cautions, but if inflation continues to slow down, rates may stabilize near 6%.”
Nadia Evangelou, senior economist and director of forecasting for the National Association of REALTORS®.
November 27, 2022
The Mortgage Bankers Association reported This Week in Real Estate that purchase applications rose 3% over the prior week marking the second consecutive week of mortgage application growth. That is in line with the decline in rates as they fell for the second week in a row. The 30-year fixed-rate is now half a percentage point lower than its recent high. According to Realtor.com, the week ending November 19th saw fewer new listings for sale compared to the same week a year ago, the 20th straight week of yearly declines. While inventory has grown it is a result of homes staying on the market longer rather than an influx of new homeowners listing their homes for sale. Additionally, home price appreciation has decelerated for six consecutive weeks.
“When mortgage rates dipped this summer, it boosted buyer demand enough to stabilize cooling trends.”
Danielle Hale, Realtor.com® Chief Economist
November 21, 2022
The Census Bureau and the Department of Housing and Urban Administration reported This Week in Real Estate that both housing starts and permits declined 4.2% and 2.4% in October from September, respectively. They are 8.8% and 10.1% lower than a year ago, respectively. The 30-year fixed-rate mortgage averaged 6.6% in the week ending November 17, down 47 basis points the week before, marking the largest weekly drop since 1981. Mortgage applications increased for the first time in seven weeks, according to the Mortgage Bankers Association. For the third report in a row the National Association of Realtors reported total inventory has decreased. NAR lists the current inventory at 1.22 million, while historical norms are between 2 million and 2.5 million.
“If mortgage rates can get down toward 5%, we can see some stabilizing in the housing data that is working from a much lower bar now. This is the way to get out of the housing recession that started in June. .”
National Association of Realtors
July 11, 2022
The Fed’s housing market ‘reset’ has us in a housing correction, mortgage rates are applying the brakes to appreciation, plus the U.S. had solid job gains in June. We take a closer look at each and tell you what to expect next This Week in Real Estate.
“Mortgage rates took a breather this past week on the prospect of less aggressive Fed interest rate hikes in the upcoming months.”
Lawrence Yun, chief economist at the National Association of Realtors.
April 25, 2022
Mortgage rates rose for the seventh straight week according to Freddie Mac, “While springtime is typically the busiest homebuying season, the upswing in rates has caused some volatility in demand,” says Sam Khater, Freddie Mac’s chief economist. Despite the rising rates the National Association of Realtors reported the median sales price in March was the highest median price ever recorded. We take a closer look This Week in Real Estate.
“We know that the builders have been underproducing since the foreclosure crisis, which is the reason we have this shortage, but when mortgage rates increase, we have seen several months of inventory rising.”
Lawrence Yun, chief economist at the National Association of Realtors.
April 18, 2022
Fannie Mae releases their national home price index and it’s showing 20% growth year over year. The 30-year fixed-rate mortgage jumped to a 5% average, the first time since 2011. And, the Mortgage Bankers Association is re-forecasting their purchase origination volume to a record $1.72 trillion, down from its previous forecast of $1.77 trillion. We take a closer look This Week in Real Estate.
“Even though existing sales volume will be slightly lower than last year, the continued growth in new home sales and the rapid rise in home prices should deliver a smaller, but solid, 4% annual growth in purchase origination volume.”
Michael Fratantoni, Mortgage Banker’s Association’s chief economist.
April 11, 2022
According to Realtor.com This Week in Real Estate the median U.S. home listing price reached its all-time high in March. Purchase mortgage rates have risen faster in the last three months than at any time in the past 28 years. Prices continue to surge and rates are rising, but today’s market differs significantly from the “Great Recession.”
“There was a lot of financial engineering, there was a lot of predatory lending, there was a lot of bad borrowing on people not having a lot of equity, not having as much of a cushion, that led to the housing bubble.”
Daryl Fairweather, chief economist at Redfin.
December 28, 2021
Will the housing market continue its hot streak in 2022? Industry experts say yes! We review 3 predictions that will continue to drive the housing market in Lane County in 2022.
“All markets are seeing strong conditions and home sales are the best they have been in 15 years. The housing sector’s success will continue – but I don’t expect next year’s performance to exceed this year’s.”
LAWRENCE YUN, NATIONAL ASSOCIATION OF REALTORS CHIEF ECONOMIST
October 27, 2021
Strong consumer demand helped drive builder confidence higher in October according to the most recent National Association of Home Builders Housing Market Index. The National Association of Realtors also released This Week in Real Estate that September existing-home sales realized a 7% increase over August sales. The Mortgage Bankers Association announced their expectations for 2022 this week, forecasting a 9% increase of purchase mortgage originations to a record of $1.73 trillion, a 62% decrease in refinance originations to $860 billion and the 30-year fixed-rate mortgage increasing to 4.0% by the end of 2022.
“Some improvement in supply during prior months helped nudge up sales in September,”
LAWRENCE YUN, NATIONAL ASSOCIATION OF REALTORS CHIEF ECONOMIST
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