Inflation Climbed In March But Showed Signs Of Cooling

Inflation continued its upward march last month but showed signs of cooling, according to new data from the Bureau of Labor Statistics. The Consumer Price Index rose 5% YOY in March, down from 6% in February. Month-over-month, inflation was up 0.1% on a seasonally adjusted basis, compared to 0.4% in February. The core index, which measures everything but volatile food and fuel costs, ticked up by 0.1% to 5.6% YOY. Though the increase is slight, it’s the first YOY acceleration since September. “This is obviously a short-term setback for the Fed. However, inflation was never expected to decelerate in a straight line,” Tiffany Wilding, managing director and North American economist at PIMCO, wrote in a note. “[N]otwithstanding this report we…

Mortgage Rates Declined Again, But Buyers Are Still Hesitant

The average mortgage rate declined for another week, giving buyers planning to finance a home this spring a little more bang for their buck. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.28%, down from 6.32% the week prior. A year ago at this time, the 30-year FRM averaged 4.27%. The 15-year fixed-rate mortgage increased, however, from 5.56% to 5.64%. A year ago, it averaged 3.91%. “Mortgage rates continue to trend down entering the traditional spring homebuying season,” said Sam Khater, Freddie Mac’s chief economist. Retreating rates aren’t enough to bring buyers priced out of the market back. Mortgage application volume, which had ticked up when rates first began declining, is dropping again as buyers contend…

Rising Property Taxes Add To Financial Stress For Homeowners

Property taxes are on the rise, another source of financial stress for Americans. According to new data released by ATTOM Data, total property taxes on single-family homes across the United States increased by 4% in 2022, totaling $340 billion.  This marks a significant increase from the previous year, with the average property tax bill for a single-family home rising to $3,719. Property taxes were highest in the Northeast, with New Jersey, New York, and Connecticut topping the list. The lowest were seen in the South, with Alabama, West Virginia, and Arkansas having the least expensive property taxes. Increasing taxes are an effect of soaring home prices, which have increased by 19% over the past year. Though homeowners have benefitted from…

Rate Hikes Up In The Air Thanks To New Economic Data

Mixed economic indicators released this week may stall the Federal Reserve’s plans for another round of aggressive rate hikes. Retail sales fell 0.4% in February as consumers strained under high inflation, Commerce Department data released Wednesday showed. Spending fell in eight of the thirteen groups analyzed, with furniture and department stores seeing the biggest dips. Bar and restaurants saw sales fall by 2.2%, the most in more than a year. But a surprise decline in producer prices provided a glimmer of hope that inflation may be cooling. Wholesale prices were down 0.1%, upending the Dow Jones prediction of a 0.3% increase. The index still increased YOY, but by less than expected. Both of these reports come just a day after…

Housing Sentiment Sinks Closer To All-Time Low

Homebuyers and sellers were feeling pessimistic about the market last month due to affordability and job security concerns. Leaders at Fannie Mae said the Home Purchase Sentiment Index fell by 3.6 points in February, breaking three straight months of increases and pushing the index closer to a record low recorded last October. “The decline was partly driven by a substantial decrease in consumers’ sense of home-selling conditions, with most respondents who indicated it’s a ‘bad time to sell’ citing unfavorable economic conditions and mortgage rates as the primary reasons for that belief,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “With home-selling sentiment now lower than it was pre-pandemic – and homebuying sentiment remaining near its all-time…

Rates Jump Again As Inflation Threatens To Stick Longer Than Expected

Mortgage rates have increased again as new data suggests inflation is sticking harder than previously thought. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage rate averaged 6.65%, up from 6.50% the week prior. A year ago at this time, the 30-year FRM averaged 3.76%. The 15-year fixed-rate mortgage rose from 5.76% to 5.89%. A year ago, it averaged 3.01%. “As we started the year, the 30-year fixed-rate mortgage decreased with expectations of lower economic growth, inflation, and a loosening of monetary policy. However, given sustained economic growth and continued inflation, mortgage rates boomeranged and are inching up toward seven percent,” said Sam Khater, Freddie Mac’s Chief Economist.  “Lower mortgage rates back in January brought buyers back into…

Powell On Inflation: “We Will Stay The Course Until The Job Is Done”

By KIMBERLEY HAAS After officials at the Federal Reserve raised rates by 25 basis points, Chair Jerome Powell said that the fight against inflation isn’t over and he does not see them cutting rates this year. During a press conference on Wednesday afternoon, Powell said the disinflationary process has started in some sectors of the economy but they remain cautious. “Certainty is just not appropriate here. Inflation, it’s just hard to forecast inflation. It may come down faster. It may take longer to come down, and yet, our job is to deliver inflation back to target and we will do that, but I think we’re going to be cautious about declaring victory and sending signals that we think that the…

Bleak Outlook For Housing Prices Predicted For All Of 2023

By SCOTT KIMBLER The director of the AEI Housing Center at the American Enterprise Institute painted a bleak picture for the rest of this year and all of 2023 earlier this month during a presentation and forecasting of home prices in the United States. AEI Senior Fellow and Director of the AEI Housing Center Edward Pinto pointed to some major factors colliding at once that will be harming market prices, appreciation of owned homes, and the consumer ability to buy or upgrade a home at all. Those factors are inflation, which is at a 40-year-high, the Fed Fund rate continuously being raised to cool inflation, a housing shortage, and employment repercussions of the pandemic. First, the volume of homes being…

Inflation, Interest Rates Cited As Top Issues For Residential And Commercial Real Estate

By KIMBERLEY HAAS The global chair of The Counselors of Real Estate says inflation and interest rates are this year’s leading concerns of his 1,000-member organization. At the National Association of Real Estate Editors conference at The Westin Buckhead in Atlanta, GA, William McCarthy said everyone they talk to wants to know about inflation and interest rates. The Counselors of Real Estate is an international consortium of commercial property advisors which has posted a top ten list of issues affecting real estate for 11 years. “Inflation dictates interest rates. Interest rates dictate inflation,” McCarthy said. McCarthy told the crowd they have some questions about the current interest rate narrative. “Interest rates are supposed to go up a little bit more, level,…

EVP: Rocket’s “Inflation Buster” Result Of Listening To Clients’ Needs

By KIMBERLEY HAAS As interest rates climb towards seven percent and loan applications fall to their slowest pace since 1997, leaders at Rocket Mortgage say they have a solution and it has a name: Inflation Buster. Rocket’s new Inflation Buster program was announced on Sept. 16. It gives homebuyers a reprieve by reducing their monthly mortgage payment by one percentage point for the first year of their loan, according to a press release. Bill Banfield, EVP of Capital Markets at Rocket Mortgage, sat down for an interview with The Mortgage Note to explain how the program is the result of leaders at the company listening to the needs of their clients. “You, me, everybody is talking about inflation. You can’t…