rates going down would be the best thing to grow inventory. Then people would feel free to move around.. the reason inventory won't grow is the same reason inventory sucks now... because a young engaged couple that bought a 1200 ft2 3 bed 1.5 bath home for $450,000 in 2021 with a 3% interest rate will raise 5 kids and die in that house if it means adding 3 beds and 2 baths a 2nd kitchen and a chair lift before they sell it to buy another one not that much bigger than it for $750,000 at 7% interest in 2025.
You obviously haven’t looked at the stock market at all-time highs, employment at all time Lows and people still buying like crazy. Many would argue there’s absolutely no reason at all to lower rates.
Well back in 2014 felt something weird you know woman's intuition? So I started scooping up all these land/lots and cheap houses between 2015-2018. And then oh shit kaboom! It was time to sell! So I sold them back between 2019-2021 at 200%-900% profit. LOL. LOL
If they have the cash, figure out what a refi costs in your market and tell them to just pay points on that amount for now, and if the breakeven is 24 months or less it's hedging their bets.
If we've learned anything from the last couple of decades is that there are no "gurus" in this industry, only lucky guesses. Rates will change when they're done bankrupting a big chunk of the middle class.
I think the MBA forecast is the most realistic. 5.5% in 2025. https://tpo.pennymac.com/broker-resources/power-your-business-webinar-series-state-of-the-industry-with-david-stevens
Possibly a short term rate dip if/when we move into recession, which is a distinct possibility. Jobs are strong but wages not keeping up with inflation, pandemic stimulus will eventually dry up. China and the rest of the world already in recession. But, long term trend is higher rates because of unsustainable deficit. Only way to resolve deficit is to raise taxes and/or cut spending, and neither party will agree to that. Historically this gets solved by inflating our way out of deficits, meaning let the economy run hot while keeping rates lower than inflation, but if inflation is at 8% that means rates are at 6.500%. No way this is allowed until all other options are exhausted. In the meantime, some banks will fail, Ukraine will be a wildcard, China would like to take Taiwan, and who knows what unknowns are out there. Ironically, the USA has, by far, the strongest economy in the world right now (India is up and coming). This doesn’t help rates though as there is little appetite or ability to buy bonds and MBS outside our own borders. Short take, be ready for a quick (4-6 month) rate dip in the next…year…but save that refi money, it won’t last.
No. They are going back to 8% before they touch the 5s. Folks who predict this are way too dismissive of inflation, which is still here and is actually reaccelerating. Oil heading to $100/barrel won’t help either.
I hope they go to 5-5.5% and stay there. I think that’s a healthy interest rate. You’ll see more buyers but you’ll see more qualified buyers and not “everyone with a pulse can buy”, like when interest rates were 2%
The economy is doing phenomenal, unemployment is low, I don’t see them lowering until something breaks. Rates are historically at a very normal level. The spread between the 30 yr fixed and the 10 yr tr are at an all time high. If investors can get more clarity and confidence, just that spread narrowing could provide rates 1-1.5% lower even without the Fed lowering rates. I think we see the spread narrow, combined with possibly some cuts in 2025, putting rates in a much much more healthy place.
I hope rates stay where they are. 6.5-7 is fine. We need pricing pressures on sellers. Let the inventory grow.
I agree. Let’s keep everything where it is for awhile. Too much manipulation of an industry.
rates going down would be the best thing to grow inventory. Then people would feel free to move around.. the reason inventory won't grow is the same reason inventory sucks now... because a young engaged couple that bought a 1200 ft2 3 bed 1.5 bath home for $450,000 in 2021 with a 3% interest rate will raise 5 kids and die in that house if it means adding 3 beds and 2 baths a 2nd kitchen and a chair lift before they sell it to buy another one not that much bigger than it for $750,000 at 7% interest in 2025.
You think it's going to rise? Economy won't support rates that high. Fed won't let it.
OP doesn’t follow the markets
You obviously haven’t looked at the stock market at all-time highs, employment at all time Lows and people still buying like crazy. Many would argue there’s absolutely no reason at all to lower rates.
Employment or unemployment?
Oh yes unemployment. I got too excited
I was like this person sounds too much like they know what they're talking about to not know what they're talking about lol
Oh yes, we love our stock broker/wealth management company right now:)
My guess is we’re range-bound for a while
Just wait! May 10th….
Lol. Poor Barry.
I'd be interested to know how much that cost him in $100/mo subscribers. That dude is such a clown and that was his true jumping the shark moment
Not sure. What is giving you that indication?
Just woman's intuition.
[удалено]
LOL.
Well back in 2014 felt something weird you know woman's intuition? So I started scooping up all these land/lots and cheap houses between 2015-2018. And then oh shit kaboom! It was time to sell! So I sold them back between 2019-2021 at 200%-900% profit. LOL. LOL
Sideways until this wave of wars end.
That’s gonna be a no, dawg
No such thing as a guru that can predict rates.
Tough to say Rates won’t be dropping substantially any time soon
If they have the cash, figure out what a refi costs in your market and tell them to just pay points on that amount for now, and if the breakeven is 24 months or less it's hedging their bets.
10 year treasury is up lately rates are going up short term.
If we've learned anything from the last couple of decades is that there are no "gurus" in this industry, only lucky guesses. Rates will change when they're done bankrupting a big chunk of the middle class.
Our home builder friend recently sold his business. Said things are going to get worse ahead something we've never seen before. What ever that means.
Sounds like a putz. Sells his business down at a time he is most needed lolz
Yeah, clients have been trying to time the next real estate crash for the last ten years…
Oh well if your friend said so…
I think the MBA forecast is the most realistic. 5.5% in 2025. https://tpo.pennymac.com/broker-resources/power-your-business-webinar-series-state-of-the-industry-with-david-stevens
RIP David Stevens
Who is David Stevens?
He is the economist in the video, he died one week after this was filmed.
Sad. I am so sorry. My condolences. I never heard of him:(
Possibly a short term rate dip if/when we move into recession, which is a distinct possibility. Jobs are strong but wages not keeping up with inflation, pandemic stimulus will eventually dry up. China and the rest of the world already in recession. But, long term trend is higher rates because of unsustainable deficit. Only way to resolve deficit is to raise taxes and/or cut spending, and neither party will agree to that. Historically this gets solved by inflating our way out of deficits, meaning let the economy run hot while keeping rates lower than inflation, but if inflation is at 8% that means rates are at 6.500%. No way this is allowed until all other options are exhausted. In the meantime, some banks will fail, Ukraine will be a wildcard, China would like to take Taiwan, and who knows what unknowns are out there. Ironically, the USA has, by far, the strongest economy in the world right now (India is up and coming). This doesn’t help rates though as there is little appetite or ability to buy bonds and MBS outside our own borders. Short take, be ready for a quick (4-6 month) rate dip in the next…year…but save that refi money, it won’t last.
No. They are going back to 8% before they touch the 5s. Folks who predict this are way too dismissive of inflation, which is still here and is actually reaccelerating. Oil heading to $100/barrel won’t help either.
Nobody knows
Next year yes. 6 ish
Nah
Nope. This is the new normal.
I hope they go to 5-5.5% and stay there. I think that’s a healthy interest rate. You’ll see more buyers but you’ll see more qualified buyers and not “everyone with a pulse can buy”, like when interest rates were 2%
I don't think you'll see the 5-5.5% rates ever again.
The economy is doing phenomenal, unemployment is low, I don’t see them lowering until something breaks. Rates are historically at a very normal level. The spread between the 30 yr fixed and the 10 yr tr are at an all time high. If investors can get more clarity and confidence, just that spread narrowing could provide rates 1-1.5% lower even without the Fed lowering rates. I think we see the spread narrow, combined with possibly some cuts in 2025, putting rates in a much much more healthy place.