MORTGAGE OUTLOOK
CONSUMER CONFIDENCE 100.4 2023: 109.7
CONSUMER PRICE INDEX 313.22 2023: 303.36
UNEMPLOYMENT RATE
DOW JONES INDEX 39,169 2023: 34,407
4.0% 2023: 3.7%
MORTGAGE INSIGHTS
Optimism remained high during the second quarter of 2024 despite the challenges in the housing market due to higher mortgage interest rates and scarcity of inventory. Despite the ongoing affordability issues driven by elevated interest rates and increased insurance premiums, there is hope for a modest recovery in home sales as mortgage rates are expected to drift down in the latter half of the year. Currently, new mortgage rates average just below 7%, but the average of existing mortgage rates across the nation is 3.8%. However, this is a far cry from the 17% rate and 10% average rate that existed for our parents back in 1979. There has been a slight uptick in refinance applications (although they still remain low) as mortgage interest rates slowly ease down from the almost 8% back in the fourth quarter of 2023. Homeowners who locked in low mortgage rates during the pandemic were shielded from the immediate impact of higher rates. (As a point of interest,“mortgage rates reset more frequently in some countries outside the U.S., with those borrowers [feeling] the impact of higher rates sooner”.) Per Mortgage Bankers Association,“mortgage rates are likely to end [the year] a bit above 6.5%”. The Fed has kept interest rates unchanged for the past 11 months while they try to balance their dual mandate of
"Cooling inflation and a slowing job market could strengthen the Fed’s position and put some much needed relief on interest rates."
AMY HANKS MORTGAGE SERVICES EXECUTIVE VP OF SALES
maximum employment and stable prices. As the Fed gains more confidence that inflation is on a sustainable downward trajectory, they will begin to lower interest rates. Cooling inflation and a slowing job market could strengthen the Fed’s position and put some much needed relief on interest rates. The mortgage industry faces both opportunities and challenges in the upcoming months. As your local lender, it is our charge to provide informed guidance to our clients and foster sustainable homeownership. Always discuss your needs with a knowledgeable and experienced mortgage professional.
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US WEEKLY AVERAGE MORTGAGE RATES (as of July 11, 2024)
7.79%
8.00%
SOURCE: FREDDIE MAC
6.89%
7
7.00%
7.03%
6.17%
6
6.00%
5.51%
5 5.00%
15 Year Fixed Rate 30 Year Fixed Rate
4.67%
4 4.00%
JULY 2022
JULY 2023
JULY 2024
HOWARDHANNAMORTGAGE.COM 31
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