3/2/2024 0 Comments Car loan interest rates![]() October’s median price of $391,800 was up 3.4% from a year ago, according to the latest NAR data. Meanwhile, limited housing supply has kept home prices rising for four consecutive months. The inventory of new homes for sale decreased 5.4% in September from the previous year, according to Freddie Mac’s latest outlook report. Those prices are expected to fall only when the housing supply increases–and building enough new homes could take years. A decision by the Federal Open Market Committee, or FOMC, to lower the Fed’s rate could quickly lead to more affordable home loans.īringing down home prices will take longer. The Fed’s actions can cause significant changes in the housing market, as its federal funds rate is the biggest influencer of current mortgage rates. Loan Rates Not The Lone Cause of Unaffordable Housing The average 30-year, fixed-rate mortgage rate declined from nearly 8% in late October to 7.03% as of December 7, according to Freddie Mac. The Fed paused its rate hikes in September and extended the pause just over a month later. “By the spring of 2024…rates will hopefully be in the 6% range.” ![]() “We do expect that rates will continue to tip down incrementally,” says Jessica Lautz, deputy chief economist and vice president of research at the National Association of Realtors, or NAR. “Our house view is that we will see rates hold steady through the end of the year and that we will see the first rate cut in March of 2024,” says Matthew Vance, Americas head of multifamily research at CBRE. Those could in turn bring about a drop in mortgage rates. The December 13 news that there would be no change in the benchmark rate, known as the federal funds rate, included indications of up to three rate cuts in 2024. With the Federal Reserve’s announcement that it will again leave its benchmark lending rate unchanged, the central bank has ended its two-year campaign of tightening credit and is expected to begin easing rates downward. Would-be home buyers may finally get some relief on mortgage rates in 2024.
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