Housing Market Updates July 6, 2023

A Summer Surge: Understanding Rising Mortgage Rates and their Implications

Kevin Farfan here, bringing you the latest on mortgage rates and how they are shaping the Tampa Bay real estate market. According to the most recent Primary Mortgage Market Survey® (PMMS®) from Freddie Mac released just yesterday, we are seeing an upswing in the rates.

The 30-year fixed-rate mortgage (FRM), a staple in our real estate economy, rose from last week’s average of 6.71% to an average of 6.81%. To put it in perspective, a year ago, the 30-year FRM was considerably lower, averaging at 5.3%. As for the 15-year FRM, it has risen as well, from 6.06% to 6.24% this week.

These upward movements are driven by a potent mix of a strong economy, persistent inflation, and a more assertive approach from the Federal Reserve. But what does it mean for you, the home buyer or seller?

As Freddie Mac’s Chief Economist Sam Khater mentioned, this upward trend, coupled with low inventory, can be a hurdle for potential home buyers. The data suggests that even though home prices remain high and there is general consensus that it’s a good time to sell, homeowners are staying put, with many citing their low-rate mortgage as the main reason. The result? A market short on supply with new listings trailing 20% behind last year’s pace.

On the buyers’ side, the same factors cause a pinch. About 78% of prospective home shoppers anticipate being priced out if both home prices and mortgage rates continue to escalate. In June alone, the 30-year fixed mortgage rates hovered over 6.6%, making the summer market somewhat tricky to navigate.

That said, there is some optimism in the air. Some economists, like Jiayi Xu from realtor.com®, foresee a gradual decrease in mortgage rates towards the end of the year. They predict that the diligent efforts of the Federal Reserve to bring inflation back to the 2% target range may result in a downward pressure on interest rates, potentially nudging mortgage rates closer to 6%.

While the real estate market might be challenging at present due to these dynamics, remember that every market state presents unique opportunities. Whether you’re looking to buy or sell, I’m here to help navigate these complex trends and find the best possible outcome for you. Feel free to reach out at 813-784-7139.

Stay tuned for more updates, and remember, real estate is a long-term investment – so don’t let short-term fluctuations deter you from your dream of homeownership.

Best regards,

Coldwell Banker Realty
213 W. Bloomingdale Ave.
Brandon, FL. 33511
Cell 813-784-7139
website: www.kevinfarfan.com
“I Sell Lifestyles!”