Mortgage Rates Will Come Down, It’s Just a Matter of Time

Posted by Bend Premier Real Estate on Monday, November 21st, 2022 at 10:00am.

Bend Oregon real estate

This past year, rising mortgage rates have slowed the red-hot housing market. Over the past nine months, we’ve seen fewer homes sold than the previous month as home price growth has slowed. All of this is due to the fact that the average 30-year fixed mortgage rate has doubled this year, severely limiting homebuying power for consumers. And, this month, the average rate for financing a home briefly rose over 7% before coming back down into the high 6% range. But we’re starting to see a hint of what mortgage interest rates could look like next year.

Inflation Is the Enemy of Long-Term Interest Rates

As long as inflation is high, we’ll see higher mortgage rates. Over the past couple of weeks, we’ve seen indications that inflation may be cooling, giving us a glimpse into what may happen in the future. The mortgage market is eagerly awaiting positive news on inflation. As Ali Wolf, Chief Economist at Zonda, says:

The housing market is expected to face continued uncertainty heading into 2023 as consumers, financial markets, and policymakers work through their respective challenges in today’s economy. . . . we are watching for any additional stability in the MBS market, signs of cooling inflation, and/or less aggressive Federal Reserve action to give us confidence that mortgage rates are past their peak.”

What Does This Mean for the Future of Mortgage Rates?

As we get through the inflation battle and start to see that coming down, we should expect mortgage rates to follow. We’ve seen nods of this over the past couple of weeks. As the Federal Reserve works to bring inflation down, mortgage rates will come down as well. Bill McBride from Calculated Risk says:

My current view is inflation will ease quicker than the Fed currently expects.”

As we look toward next year, we certainly hope he’s right.

Bottom Line

Mortgage rates will come down – it’s just a matter of time. The hope is we continue to see more positive news on inflation, and that’ll bring mortgage rates down. This will give prospective homebuyers more buying power and lead to more homeowners throughout the country. Connect with your Bend Premier Real Estate broker for more information on the current Bend real estate market.

4 Responses to "Mortgage Rates Will Come Down, It’s Just a Matter of Time"

Mortgage Rates Will Come Down, It’s Just a Matter of Time - Salem Local News wrote: [...]Source link [...]

Posted on Monday, November 21st, 2022 at 10:23am.

Mortgage Charges Will Come Down, It’s Only a Matter of Time - Portland Local News wrote: [...]Source link
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Posted on Monday, November 21st, 2022 at 10:42am.

If Only I had Bought My Bend Home Six Months Ago - Salem Local News wrote: [...]When interest rates drop in the future, Bend homeowners who have purchased with high rates can refinance and obtain a better monthly payment. 
If you have considered purchasing Bend real estate, but have[...]

Posted on Monday, November 21st, 2022 at 1:23pm.

If Solely I had Purchased My Bend Dwelling Six Months In the past - Portland Local News wrote: [...]of interest drop sooner or later, Bend householders who’ve bought with excessive charges can refinance and procure a greater month-to-month fee. 
When you have thought-about buying Bend actual[...]

Posted on Monday, November 21st, 2022 at 1:49pm.

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