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April 2023 Market Report

What's happening with mortgage rates?

Because we see a slowdown, and we see the inflation comparisons start to become more and more favorable, you’ll start to see that inflation number move lower, lower, lower, lower. And as a result, mortgage rates should move similarly on a downward trajectory—probably giving us around 5%, below 5% within the next six months. 

For the second quarter in a row, the mortgage delinquency rate fell to its lowest level since MBA’s survey began in 1979 – declining to 3.45%. Foreclosure starts and loans in the process of foreclosure also dropped in the third quarter to levels further below their historical averages.

I’d say if you are a homebuyer, somebody or a young person looking to buy a home, you need a bit of a reset. We need to get back to a place where supply and demand are back together and where inflation is down low again, and mortgage rates are low again.

The upcoming months should see a return of buyers, as mortgage rates appear to have already peaked and have been coming down since mid-November.

The housing market, once adjusted to the new normal of higher mortgage rates, will benefit from continued strong demographicdriven demand relative to an overall, long-run shortage of supply.

From our perspective, the good news is that demographics remain favorable for housing, so the sector appears well-positioned to help lead the economy out of what we expect will be a brief recession.

 

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