Good Monday Morning and Happy New Year!

Mortgage rates dipped slighly in December, but ticked up right before years end. The reality is that mortgage rates most likely have not peaked. How high will they go in 2023? This is a question that has much debate right now. My thought is that rates will continue to rise, but at a much slower pace than 2022. Even with home inventories low, home prices should decrease further to compensate for higher mortgage rates. As I have stated previously, the housing market we see right now may be the most advantageous market we see this year for both buyers and sellers. Here is a recent article that speaks to our current national housing market.

Mortgage rates notched their first weekly increase in six weeks just before the new year.

The average rate for a 30-year fixed-rate loan climbed to 6.42 percent from 6.27 percent, according to Freddie Mac data reported by Bloomberg. The figure closes out a year over which mortgage rates more than doubled, pricing out potential homebuyers and locking sellers in place.

Higher mortgage rates “remain a significant barrier to successfully closing transactions,” George Ratiu, head of economic research at Realtor.com, told Bloomberg.

As more buyers sit on the sidelines, homes are taking longer to sell. Inventory has risen as a result, but the population of available listings is still down from the pandemic-era housing market.

The number of properties for sale has risen 18 percent since last year, according to a recent report by Redfin, for the biggest gain since 2015. However, the brokerage reported home sales dropped 35.1 percent year-over-year in November — the largest drop since it began tracking sales in 2012.

The buyer of a median-priced home would pay about 60 percent more than last year due to higher borrowing rates, or about $2,100 a month without taxes or insurance, according to Ratiu.

Mortgage rates rose following an increase in 10-year treasury bond yields, which indicated more investors were seeking a safe store for their money. A key inflation metric showed earlier this month that consumers were paying six percent more than a year ago for goods and services.

The Federal Reserve is targeting an annual inflation rate of two percent, suggesting that its campaign to stem high prices and high wages with even higher interest rates is far from over.

Have An Awesome Week!

Stay Healthy! Stay Safe! Remain Positive! Trust in God!

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AND HERE'S YOUR MONDAY MORNING COFFEE!!