Mortgages hold steady ahead of election, inflation metrics
Mortgage rates appeared to be holding their breath ahead of the mid-term election and inflation metrics due on Thursday. We have an idea of which party will have control of the U.S. Senate and House of Representatives, but we’re still holding our breath until the latest inflation data is known.
The national average for a 30-year fixed mortgage rate ended Tuesday’s trading at 7.21%*, virtually unchanged from Monday.
Is a housing market correction on the way?
Most pundits agree that housing prices should cool off early 2023. A slight cool off has already started as we’ve seen declines in home prices over the past few months. Where the experts disagree is in how steep the decline will be. Some say that it’s going to be closer to a ‘correction’ that sees a steady decline. Others say it will be a swift move down that is likely to be a bit more painful than a steady ‘correction’.
Fortune reviewed multiple viewpoints on home ownership from leading industry experts. Of the pundits surveyed, Moody’s Analytics chief Mark Zandi was the most moderate. His view is that homes were already overpriced by at least 25% during the pandemic and believes that prices should normalize, restore affordability, and we won’t see the overheated housing after a correction back to historic norms.
Can buyers get incentives from home builders now?
Home builders, in an effort to get out of projects that are slow to sell, are incentivizing buyers in multiple ways to making home buying more cost effective. Affordable rate buy-downs, reduced closing costs, and other amenities have been introduced to make home buying more attractive. In fact, 53% of the National Association of Home Builders are offering some form of incentive to home buyers. While market conditions may not be ideal, there are still options to make home ownership more affordable.
* National average rate is provided for educational purposes only and is not an advertised rate from Guaranteed Rate.
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