Why mortgage rates are going up while the Fed is cutting rates

[Aquaman]

 

[Hitman]

matter in single line please????

[nenu_meeku_telusa]

1 hour ago, Hitman said:

matter in single line please????

Why mortgage rates are going up while the Fed is cutting rates

Despite the Federal Reserve's rate-cutting, mortgage rates are rising, confusing many prospective home buyers. The Chief Economist of Bright MLS, Lisa Sturdivant, explains that the mortgage market is influenced more by expectations and economic projections rather than actual rate cuts. As such, current mortgage rates are expected to stabilize around the mid-sixes, and buyers must adapt their expectations based on these shifts.

Key Points:

Market Reactions vs. Fed Actions
The increase in mortgage rates despite the Federal Reserve's cuts is attributed to the market's reaction to expectations rather than the Fed's actions. Anticipatory movements prior to the Fed's cuts in September kept rates low, but revised economic projections concerning inflation led to rising mortgage rates.

Buyers Missed Opportunity in September
Many prospective home buyers capitalized on the brief dip in mortgage rates to around 6% in September, leading to increased pending sales. However, a considerable number of buyers missed that window and are now anxious about when they will have a subsequent opportunity.

Predictions for 2025
Although predictions suggest potential high mortgage rates up to 8%, the expert anticipates a 'new normal' stabilizing rates in the mid-sixes. Buyers are adapting their expectations, comparing current rates to those experienced historically rather than to the pandemic lows.

Impact of Economic Indicators
Future movements in mortgage rates are expected to be more closely aligned with indicators such as the 10-year Treasury yield, inflation, labor market strength, and consumer confidence rather than solely focusing on Fed rate cuts. Monitoring these economic factors will be crucial in anticipating mortgage trends.

Long-term Housing Market Expectations
The housing market is expected to see increased buying activity if there is any downward trend in mortgage rates. With a significant pent-up demand from buyers, the market might respond positively despite current rate challenges.

[Hitman]

2 hours ago, nenu_meeku_telusa said:

Predictions for 2025
Although predictions suggest potential high mortgage rates up to 8%, the expert anticipates a 'new normal' stabilizing rates in the mid-sixes. Buyers are adapting their expectations, comparing current rates to those experienced historically rather than to the pandemic lows.

[akkum_bakkum]

3 hours ago, nenu_meeku_telusa said:

Why mortgage rates are going up while the Fed is cutting rates

Despite the Federal Reserve's rate-cutting, mortgage rates are rising, confusing many prospective home buyers. The Chief Economist of Bright MLS, Lisa Sturdivant, explains that the mortgage market is influenced more by expectations and economic projections rather than actual rate cuts. As such, current mortgage rates are expected to stabilize around the mid-sixes, and buyers must adapt their expectations based on these shifts.

Key Points:

Market Reactions vs. Fed Actions
The increase in mortgage rates despite the Federal Reserve's cuts is attributed to the market's reaction to expectations rather than the Fed's actions. Anticipatory movements prior to the Fed's cuts in September kept rates low, but revised economic projections concerning inflation led to rising mortgage rates.

Buyers Missed Opportunity in September
Many prospective home buyers capitalized on the brief dip in mortgage rates to around 6% in September, leading to increased pending sales. However, a considerable number of buyers missed that window and are now anxious about when they will have a subsequent opportunity.

Predictions for 2025
Although predictions suggest potential high mortgage rates up to 8%, the expert anticipates a 'new normal' stabilizing rates in the mid-sixes. Buyers are adapting their expectations, comparing current rates to those experienced historically rather than to the pandemic lows.

Impact of Economic Indicators
Future movements in mortgage rates are expected to be more closely aligned with indicators such as the 10-year Treasury yield, inflation, labor market strength, and consumer confidence rather than solely focusing on Fed rate cuts. Monitoring these economic factors will be crucial in anticipating mortgage trends.

Long-term Housing Market Expectations
The housing market is expected to see increased buying activity if there is any downward trend in mortgage rates. With a significant pent-up demand from buyers, the market might respond positively despite current rate challenges.

endayya @Sonu_Patel idi....illu konetollaki inka kashtaalena

[Konebhar6]

I haven't seen the video. But here's what I know.

Mortgage rates do not depend on the Fed Interest rates but rather on the 10-year Yield which is more dependent on the Inflation in the country. Since inflation is rising, the 10-year yield is increasing. In a normal scenario, a 10-yr yield is supposed to go down as Fed lowers Interest rates. 

[krishnaaa]

2 hours ago, Konebhar6 said:

I haven't seen the video. But here's what I know.

Mortgage rates do not depend on the Fed Interest rates but rather on the 10-year Yield which is more dependent on the Inflation in the country. Since inflation is rising, the 10-year yield is increasing. In a normal scenario, a 10-yr yield is supposed to go down as Fed lowers Interest rates. 

With Shelter inflation going down but lagging in the reports and jobs slowdown, inflation should go down in 2025.

This should lead to more interest rate cuts (more than the 2 they said).

Mortgage rates should go down to atleast 5s this year.