Mortgage rates start the week lower
The national average for a 30-year, fixed-rate mortgage ended Monday’s session down 0.01% at 7.28%*. Trading was mostly sideways for the day with the Fed’s interest rate decision coming on Wednesday. There’s a good chance that today is more of the same as the market waits to see if the Federal Reserve will choose to hike rates again or decide to pause.
When could the Fed start cutting interest rates?
The Federal Reserve has made 2% inflation its target, and we’re probably not going to see a cut in interest rates until the new year at the earliest.
According to experts surveyed by Business Insider, an interest rate cut by the Federal Reserve may not happen until 2024 or later depending on who you ask.
The chief investment manager of J.P. Morgan Asset Management, Bob Michele, stated, “They’re going to tell us that they’re going to keep rates higher for longer until inflation is at their target, but the magnitude of the slowdown we’re seeing across the board tells us that we’ll probably still be hitting recession around year-end, so they’ll be cutting rates by then.”
David Einhorn, the founder of Greenlight Capital, wrote the following, “We continue to believe that the market is over-anticipating rate cuts and we have extended that view through March of 2024.”
The chief U.S. economist at Citi, Andrew Hollenhorst, said, “Tight labor and housing markets present upside risk to inflation. That means that absent a recession, policymakers are likely to keep policy rates on hold well into 2024.”
Jeff Morton, a portfolio manager at DWS group, felt that the Fed won’t look to cut rates until late next year. Morton said, “We have pushed back our cut forecast to later next year, at the pace of one cut per quarter barring any severe recession.”
How is a billionaire lottery winner spending his money?
The winner of a Powerball jackpot worth $2 billion, Edwin Castro, has gone on a bit of a real estate buying spree.
Castro, after opting for a $997.6 million cash option rather than 29 years of payments, ended up with about $628 million in cash after taxes. Since receiving his money, Castro has started snapping up luxury properties in California.
Castro bought property in his hometown of Altadena, CA and Hollywood Hills, and recently added his most lavish purchase. He is the proud owner of a Bel Air mansion priced at $47 million. The Bel Air property features seven bedrooms, 11 bathrooms, a koi pond, a large theatre, an infinity pool, a wine cellar and a champagne tasting room.
His real estate purchases are believed to have cost around $76 million so far, leaving Castro with a substantial amount of his winnings.
* National average rates accurate as of 9/18/23 from MortgageNewsDaily.com and are not advertised rates from Guaranteed Rate.
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