POST TAGSMortgage News
Blog posted On November 21, 2023
Rates continued their downward trend last week, bringing them to their lowest levels in months. Who do we have to thank? The consumer price index from October. This showed that inflation was cooler than expected last month, which is a good thing for rates. Now, the bigger question that remains is: does this mark the beginning of a downward shift in rates?
How much lower will rates go?
The trajectory of rates moving forward depends on a few factors: inflation, the bond market, the labor market, and the Fed. If the bond market believes that the Fed is finished with rate hikes, then it will likely lead to lower bond yields and mortgage rates. And if inflation keeps falling, the Fed will need to cut rates. Same goes for the labor market. If it continues to underperform, rates will likely slip lower.
However, there’s a more important question than how much lower will rates go? It’s when will we see more rate stability? Right now, and over the past year, rates have been so volatile that there are huge swings in a matter of days. This makes it hard for many Americans to plan. A common worry that’s keeping many Americans frozen is that they could qualify for a certain rate today, list their home, and rates could be higher tomorrow. This is why we’ve seen an uptick in rate locks, buydowns, and anything with a secured, discounted rate. So, an important factor in the rate discussion is stability.
And, of course, it all goes back to the data. We will be watching the incoming reports over the next month as the year closes, as will the rest of the market.
If you’re curious about any of our rate locks or buydowns, let us know.