Mortgage rates unaffected by Fed meeting minutes
Announcements from the Federal Reserve have been known to impact the mortgage market from time to time. Wednesday’s announcement didn’t end up making much of an impact. The Fed released the minutes from their mid-December meeting. The additional guidance from the Fed is meant to give greater context to the changes in policy and can move markets depending on how notes are worded. This time around, the mortgage market shrugged.
The national average for a 30-year, fixed-rate mortgage actually ticked lower to 6.41%, down 0.04% from yesterday.
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What’s the outlook for luxury properties in 2023?
We’ve seen predictions for the real estate market as a whole in 2023, but what about the luxury property market? The luxury market, much like the housing market, is expected to see a cooling off of home prices in 2023, with a rebound predicted to start in the second half of the year.
According to Jonathan Miller, president and CEO of Miller Samuel, “The pivot of Fed policy has had an impact on every housing market in the country because rates were too low for too long.” Higher than average rates and elevated prices have impacted the luxury market the same way they have impacted the market as a whole.
Miller did offer a bit of a silver lining in his comments. He stated, “What we’re seeing is a housing market that is coming back down to Earth, but likely to be better than pre-pandemic conditions because the housing economy has been restructured with the advent of remote work.”
What happened to mortgage demand at the end of 2023?
Between the holiday season and the current housing market, demand for mortgages ended the year down 13.2% at the end of last week from two weeks earlier. Mortgage rates ticked slightly higher at the end of the month but remained down over half a point from their 2022 high.
13.2% sounds like a lot, but considering the seasonal trend, it’s unlikely that this is part of a greater trend. Demand should pick up as we inch closer and closer to the spring.
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