Brought to you by Scott P. Rogers, Funkhouser Real Estate Group, 540-578-0102, scott@HarrisonburgHousingToday.com
Brought to you by Scott P. Rogers, Funkhouser Real Estate Group, 540-578-0102, scott@HarrisonburgHousingToday.com
Monday, July 10, 2023
Here's an interesting article for your perusal...
Morningstar makes a bold call that housing market affordability will be restored by 2025. Here’s how
If you can't access the entire article, here's the gist of it...
There are three levers that can ease housing affordability:
- falling mortgage rates
- falling home prices
- rising incomes
As per this article...
"A new housing report put out by Morningstar expects mortgage rates will indeed be the primary lever that helps to ease housing affordability."
"As of Friday, the average 30-year fixed mortgage rate tracked by Mortgage News Daily stands at 7.14%. Morningstar expects that’ll trend down in the second half of the year, and we’ll average 6.25% for 2023. Morningstar’s forecast model then expects mortgage rates will average 5.00% in 2024 followed by 4.00% in 2025."
The entire article is worth a read.
Other groups putting out predictions for future mortgage interest rates aren't thinking they'll get as low as Morningstar predicts, but they do think they will decline over the next few years.
The last paragraph of the article holds a key reminder...
"When it comes to mortgage rate and home price forecasts, it might be best to take them with a grain of salt. Uncertainty in the economy makes it hard to predict both mortgage rates and house prices."
So... you certainly shouldn't count on lower mortgage rates in the future (relative to either waiting to buy until rates drop, or buying now with a plan/need to refinance to a lower rate later) but it is interesting to see multiple groups now predicting lower mortgage interest rates over the next few years. That change would be welcomed by home buyers!
