Mortgage & Finance

Mortgage interest rates are still too high, yet lower than they were a year ago.  I guess “too high” is subjective, but the price of housing, sky-high property taxes, and higher-than-ever insurance rates make buying a house out of reach for many. Banks, insurance companies, brokerage firms, and money managers benefit when interest rates are high. Home buyers do not benefit.

Mortgage interest rates were much higher when I bought my first home but housing prices were much lower in proportion to incomes.

Experts have been predicting that mortgage rates will go down. At the beginning of the year, forecasters predicted lower rates by the end of 2024. They are lower than they were last December (7.03%). Supposedly they will go down in 2025 and in 2026. We shall see.

Sure mortgage interest rates have gone down but they are still significantly higher than about 75% of current homeowners pay.  It is hard to move up to a more costly mortgage which is why so many homeowners are staying put.

However, rates are going in the right direction which is down. When they get down to 5.5% and lower homeowners will be more interested in moving.

Mortgage interest rates went down a little last week. Apparently, there is less inflation, and employment numbers were revised. I find the whole job thing confusing as I know several people who are struggling to find the right job.

Here is a look at mortgage interest rates from Freddie Mac. They are below 7% but not by much. Lower rates cause mortgage applications to rise.  The number of homes on the market in the Twin Cities is up slightly from last month. Home buyer demand remains very strong.

On average mortgage interest rates decreased slightly last week compared to the prior week. Rates are up from last year at this time, just below 7%.  Still too high.  Home prices are still rising but at less than 5% and rents in the Twin Cities have increased by less than 4% this year.

I am disappointed in the Federal Reserve. I had hoped they would be lowering rates by now. High housing costs and high interest rates are contributing to inflation.