What did recent inflation data have to say?
The Bureau of Labor Statistics reported that the Consumer Price Index rose 3.2% in the 12-month period ending in February 2024. Economists set the expected number at 3.1%. On a month-over-month view, prices climbed 0.4% in February compared to 0.3% in January.
Michael Antonelli, managing director and market strategist at Baird & Co., stated, “I think that the market got ahead of itself when it came to how fast we’d get back to 2%.”
Antonelli went on to say, “The components we thought would have reduced, especially shelter, which comprises the bulk of CPI — it’s a gigantic weight in the composition of the index — we thought would have dropped further.”
A hotter inflation rate may cause the Federal Reserve to think twice about cutting interest rates, but we’ll have to wait until March 20th to find out what they plan to do.
What’s the magic number for mortgage rates?
A report from the team at MarketWatch detailed the number that mortgage rates need to get to in order to bring buyers back into the market. According to their research, mortgage rates would need to get down to around 5% to get homeowners to want to sell, and get homebuyers off the sidelines.
The MarketWatch team claimed that a 5% rate would make it easier for homeowners to look to sell because moving from a rate in the 3’s to a rate in the 5’s is a bit easier to handle than moving from a rate in the 3’s to a rate in the 6’s.
They also claimed that if there are more homeowners willing to sell with lower rates, home prices have the potential to move lower with more inventory coming available.
Where are the most expensive housing markets in the U.S.?
A recent USA Today article detailed the most expensive housing markets in the U.S. to buy into. Believe it or not, but it’s in California. According to the data, the most expensive zip codes in the Golden State are in Santa Clara County. The median home price in Santa Clara County is $1,538,130. San Mateo County was the only other county in the U.S. to have a median home price over $1.5 million.
The only county in the top five that isn’t in California? The median home price in Nantucket County in Massachusetts is $1,313,450.
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