Here we go again! This week the real estate news has been the NAR settlement and the Fed meeting! The Fed meeting really went better than most expected. They did not move rates – which was expected. As far as a rate cut, we are still waiting. And we will probably be waiting until June or July. Going forward the Fed will continue to adjust it’s policies based on economic data, outlooks and risks. So what does that mean?
The good news from the Fed was that they still expect to cut rates three times in 2024. The projections show .75% in rate cuts this year but the big question is when. Most expect the first cut to be in June but it will depend on inflation reports between now and then. The Fed still wants to see inflation come down to 2% but we aren’t there yet. The annualized inflation rate hit a 41 year high of 9.1% in June 2022 and was down to 3.2% in February 2024.
The Fed also is continuing to reduce it’s Treasury securities, mortgage backed securities and agency debt. Depending on the inflation and employment reports, the Fed will look at adjusting it’s monetary policy when it meets again on April 30-May 1.
So what does that mean for mortgage rates? The initial reaction from the bond market was good. Wednesday afternoon the bond market did react positively. Today the bond market has been fairly flat. Interest rates improved a little bit from Tuesday but there wasn’t a huge improvement. More than likely we will see slow steady improvement over the next few weeks/months as long as inflation shows improvement. Most still expect rates to drop by the end of 2024 but probably not as much as originally hoped.
So are you looking to buy a home and not sure what to do? Most still expect homes to increase in price and rates to slowly drop. The best advice is to look at your situation and decide if you are ready to make a move. As many of us say, you marry the house and date the rate! You always have to chance to refinance your mortgage when rates do drop but you may have to pay more for the home if you wait to buy. Talk to a loan officer, feel free to call me or email me and we can talk about options for you and make a plan!
Leslie Vanderwerf, NMLS ID#335509, CrossCountry Mortgage LLC, An Equal Housing Lender, NMLS#3029 – Email – Website
