Mortgage Demand Stalls as Rates Climb
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- čas přidán 22. 08. 2024
- Homebuyer demand in the US has stalled for the past several weeks likely due to stubbornly high mortgage rates. This has led to a decrease in the number of mortgage purchase applications from a year ago which is a leading indicator of future closed home sales in the following one to two months. In today’s video, I also share other leading indicators of the US housing market as well so we can gauge which direction we are headed.
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To give you a quick mortgage interest rates update, according to the Mortgage News Daily the average 30yr fixed rate mortgage is around 7% for the current mortgage rates (at the time of filming this video for those with excellent credit).
Comment below: what’s your housing market forecast? Do you think a housing crash will happen or are your housing market predictions that the real estate market and home prices will continue to surge?
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Jason Walter, CPA (inactive CPA lic 103885)
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#mortgagerates #realestate #housingmarket
The fact that so many people are refinancing at these high rates is a major red flag.
Credit cards tapped out..401k tapped out, Now tapping out equity.
Financing means You can't afford it.
Cash is King.
Gotta keep it afloat until the next handout !
Yet another silly hot take by a clueless renter.
"Struggling" people don't get approved for mortgages, Renter. 🙄
It’s not interest rates. It’s the rip off prices. Homes in San Diego here still selling. 2 million for 2600 square foot house. Idk who is buying.
A lot of them are proposing a rate buy down, which is only beneficial for the mortgage companies
It’s not impossible. Just find an area that isn’t insanely overpriced. For me it was leaving Orange County CA. Went to Riverside County got a 4 bedroom house for 50% less.
Sold in 2022 and left the Silicon Valley Madness along with Californias lawless approach for criminals been renting for 18 months. Waiting patiently for a great deal in Las Vegas still overpriced here however starting to see price reductions and more incentives. Let’s not forget about the buy downs . All signs of things are slowing in new construction good luck to all on what ever goal you are trying to accomplish 👍🏽🇺🇸🇺🇸🌴
Why are housing prices so sticky? I saw some data from the 08 crash and even then it took like 2 years to reach the bottom - i.e. 2010.
Due to inventory remaining at low levels, even though it's up from a year ago though. Also, keep in mind the new home construction stats are way different compared to the existing home market. Here's a recent video I made about that: czcams.com/video/Rx4VNa_hXI0/video.html
Prices bottomed in the 4th quarter of 2011. More than 6 million homes were foreclosed on in total, with many more being sold as short sales. It took a long time to get inventory back to more normal levels and for prices to stabilize.
Gee maybe it has something to do with the runaway inflation caused by the 40% increase in money supply over a two year period.
Ya think ?
Thank you for the content. Are interested rates high? Or are they just getting back to what was normal before we had our fed hold rates down for a long time.? I think this is the new norm. 3% interest rates are not coming back anytime soon and this is the new norm.
You bet! It's high when compared to the 3-5% rates over the past few years and high when accounting for the increase in prices.
I agree that the 3% rates were an anomaly. The average over the last 50 or so years is closer to 7%. I paid over 10% on my first home and that was a deal compared to the general market.
If interest rates keep going up, I only see buyers who need to buy a home otherwise why by when the rates are so high
Thank you for your comment! The issue of waiting for rates to fall is that bidding wars could come back which increases prices.
@@JasonWalter1we will see that in a few months , 3 quarter .
When rates are cut all the people that have waiting will be having bidding wars for the few houses available.
At least in California
1/3 of loan app are for refinancing purposes? Yeahhh nothing to see here. 👀
It's been that way for a long time which blows my mind. The number of refi's is still very low though. The majority are cash out refi's.
Inflation + a bad economy + higher interest rates = a pending crash!
No crash...Big price cuts.
Crash, price cuts, short sales, govt programs, BK's all coming big time next few years. Once downturn picks up more investors may wait for prices to fall more. Why not?
Jason, someone on the other real estate channels brought up a good point and that is median prices are increasing because the majority of the houses being sold are luxury high end ones. These are the all cash sales and i believe about half of all purchases out there now are rich all cash buyers. Have you done an analysis of prices yoy using price ranges?
I did some research for you and found there's some truth to that (at least based on data from NAR). Here you go: cdn.nar.realtor/sites/default/files/documents/ehs-02-2024-supplemental-data-2024-03-21.pdf?_gl=1*1m29ps2*_gcl_au*MTA3Mzk0NzgxLjE3MDkyMjk4NDE.
Why is nobody else concerned that 1/3 of home buyers are cash buyers (and a major influx of illegals... coincidence?)? And the refi rate is 1/3 of home owners? These are massive numbers. I'd need the market to drop close to 40% just to afford a house today. I am at a loss for words with the cost of SFR.
I don't think it's immigrants. More like people making 250k a year working tech jobs.
Illegals buying homes?😅
Do you think that illegal immigrants are to blame for the ~30% share of cash buyers. So, walking over the border with suitcases full of cash?
@@JasonWalter1 my thoughts exactly!!! Most of the people I see buying are making good salaries and not working for $30K/year picking crops 12 hours a day.
@@JasonWalter1 Just a theory, but cartels have a significant cash business. Could those cartels or any out of country buyer be doing that? I think, why wouldn't they as this could be an easy way to hide funds, revenues, ... Do I think it's 30%? Absolutely not. I'm not saying that's where ALL the purchases are coming from, but even if it's 10% that's a large number.
This will just lead to more cash buyers squeezing out the middle class from homeownership.
Im glad
Thinking new listing's have started to go down (weekly from redfin data center) due to the NAR settlement? People seem to want to wait to list to save 3%? Thoughts Jason?🎉
Thanks for your question. The NAR settlement doesn't make commissions less than they are now. NAR is agreeing to omit the buyer's agent commission being offered by the seller from the MLS. So a commission can still be given to the buyer's agent (it just can't be noted on the MLS). Hard to know exactly what will happen but certainly there will be some changes. My guess is the reason why listings remain relatively low is from people locked into low rates (around 90% of homeowners who have a mortgage have a rate less than 6% per Resiclub).
Nothing will change. Seller will still pay commission 5% split, my sellers no problem paying they want their home sold.
FHA loans may be up as a lot of these have to be 0-down deals.
Is there going to be a full economic collapse soon? It feels like when it happened in 2008, but it might be in a different way? What are your thoughts?
Unless we go into a huge war then no.
Commercial real estate alone could cause it in some areas.
Baby boomers downsizing/passing away will cause waives of inventory for quite a long time. That’s where most of the inventory is.
It does seem like things are headed that way
Not durying an election year.
No. The economy is doing OK. And in O8 the collapse was caused by people buying homes that had no business owning a home. There was so much excess money coming in from Asia that loans like NINA (No Income, No Asset verification) were common. So many people got into homes that they never should have tried to own.
Yeap.
Higher interest rates to get the unemployment higher.
By time.
But might be a little too late.
Why
Do you
Type like
That it’s
Odd
@@MrRussianGerman
Conclusion.
Followed by my opinion.
Mahalo 🤙🏽🌴🌴🇺🇸👍🏽
Good morning!
3RD and by my dumb math happy Thursday Jason 😊😂
😂 Good morning Steve!
First
Nice! Good morning!