Are 3% Mortgages Coming Back?
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- Опубліковано 7 лют 2025
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Refinance time ... if you don't have a house it's going to hard
Really appreciate the content you put out and helping people with financial literacy that’s completely missing in modern American society.
One thing that I think is worth clarifying on mortgages is that in some cases, the way you described the $$ flow from the Fed funds rate to the bank is how it works, however the vast majority of loans (basically any true conventional or govt guaranteed loan) the money comes from mortgage backed securities. These are investment opportunities similar to stocks, but instead of owning a piece of a company, you own a piece of a mortgage. Those investors will react to financial news all the same including the Fed. But the best day in MBS in the last few years was the day before the Fed began lowering rates in September, since then each time the Fed has lowered, mortgage rates have actually gone up since mbs have gone down in value. The Fed doesn’t control mortgage rates.
In summary, everything is still extremely unpredictable and no one knows what’s going to happen 😣lol
Donald Trump promised though and he has never lied
Thank you. No need to watch the full vid now.
That’s how the stock market pundits are too. They don’t know shit
Right?! So stressful lol
Eh more like things can be relatively predictable with exceptions
Don't forget banks will almost always sell your mortgage loan to another bank without you even knowing it
Banks sell mortgages all the time, it doesn't make your interest rate go up. My last house changed companies four times over ten years before I sold it
@@outthere6518 and it gets screwed up when they do this too. When my mortgage got sold the new company didn't pay the property taxes. Then they refunded my escrow account for being overpaid. I called and specifically asked if the taxes were paid and they said yes. I then called the city and asked if the taxes were paid and they said yes, what they didnt say was they were paid at a tax auction and the ONLY reason I didn't lose my home was because the following year the person that paid the previous years tax bill didn't pay the current year and the 1st person to give the city $15k would own my home, right out from under me. And I only found that out when a friend saw my name on property in the upcoming city auction. After cleaning up that disaster and recovering from that financial hit we refi'd to a higher rate with a local bank that doesn't sell the mortgages they underwrite.
@@outthere6518mine too.
Great explanation on how the mortgage market is all connected. Recently started watching your videos and I’m loving it.
Keep up the good work!
There's too much uncertainty daily to even begin to make an educated decision.
⏸️ Tarrifs: On pause
⏸️ TikTok Ban: On pause
⏸️ Aviation control hiring: On Pause
This "leader" cant make a damn decision about anything. Hes the indecisive can kicker in chief. Makes me actually miss Biden when everything was "sleepy". I miss sleepy and predictable.
@@talyahr3302 Yeah....that was going so well. 🙄
@@talyahr3302I actually strongly recommend that you look up a compiled list of the Biden administration's accomplishments too. Yes, there are a lot of issues with the DNC and Biden was definitely in mental decline, but a lot of great things were accomplished, and we were well on our way to economic recovery from the lasting effects Covid had on our economy.
Now Trump's administration will "drain the swamp"; so, that they can fill it with their own sludge. The next four years will be a propaganda fueled fever-dream of economic and social instability.
I don't think it's all doom and gloom, but i think seeing the way some of the richest people on the planet celebrated Trump's inauguration was indicative of the implications of the current administration.
@@talyahr3302predictably bad
@@heywoodjablowme7941 Better than now. Ijs
You are so eloquent and make everything so simple to understand. Thank you!
I don’t really see how a 3% mortgage will change the overall picture. By Jaspreet’s own narrative. A 3% mortgage rate would encourage more sellers to sell, but they would need to buy another house. Additionally, there would be more buyers entering the market, who were waiting for mortgage rates to fall. If there is not a surplus of houses for sale compared to the number of buyers, the price of housing will continue to rise and the previous cycle will be repeated.
You're right.
We don't need 3% mortgages again.
We need home prices to crash 60%
@@ArmageddonIsHere60 percent is a bit much, but they are like 27-30 percent over valued
Either way the houses will be unaffordable unless homelessness and the economy are dealt with
@@ArmageddonIsHerethat would be nice
@@TheMagician2025 I agree we need to drop regulations so we can make is easy to build more housing
This is a dope video! This guy broke it down in a way that a middle schooler can understand him. PROUD subscriber now🎉
I think home prices would run away again I live in Las Vegas our inventory is increasing home buyer demand is decreasing but home prices are magically going up. And with lower rates I think they would go up even more
Especially if they know Americans have more money to spend. Disposable income is what they want.
Where I live there’s a lot of people selling their houses already, but is taking long time to sell.
Doesn’t matter the interest rate if the price is too high for wage earners to qualify so more homes will continue taking longer to sell. Not enough qualified buyers. They aren’t addressing the elephant in the room. Extreme low wages
@@cherryblossoms942 wages is not the elephant in the room
Beautifully explained 👏
There are not enough homes available for 3% mortgages again. If existing 3% rate holders sell, they will need to buy. It would be ridiculous all over again. People will have extra cash to pay way above the asking price again because of the equity they gained over the last 5 years. We need to build more homes and communities
That's what Kamala Harris wanted to implement
If the interest rates came down back to 3%, the housing market supply would increase dramatically.
A huge crash of everything is the only way out
I'm certainly not giving up my 2.875% that we over pay on each and every month since the first payment was due, The lower the rates go the higher prices will go JUST like during The Coooof , people were literally lining up down the street and around the corner wanting to buy a just listed home to where sellers needed auctioneers plus they were giving MANY THOUSANDS over asking with no appraisals, no inspections. I'm not going anywhere.
Doesn’t mean it can’t happen
He's a property guy. In 2006, he was cautioning that the Fed was making trouble by constantly increasing rates, and his view was that the rates needed to get back down to avoid a recession. We didn't need everybody trying to rent out second homes that were mortgaged, financed by countrywide. So his views have not changed - from a property developer/realtor view, the solution is always selling more homes even if people can't afford them. Interest rates are rarely the problem. High prices might be. High property taxes might be. Low-paying jobs might also be a problem. But simply lowering rates isn't the solution.
Trump should stay out of this, unless he wants prices to go up even more. We need a price correction, not a lowering of the mortgage rates. Quick fixes often come with long term problems. I would like the future generations to be able to afford to buy homes someday.
I would generally agree, but that correction will not be a correction. It will simply wipe out millions of Americans and cause a wealth transfer. Prices will still go up and the working poor will suffer.
Awe... You sad Kamala lost😢. I'm going to go ahead and trust a man who's made billions over and over, instead of crooks who send our money to other countries for a kick back.
I agree, But we not in a recession like in the 90's gdp is growing among other factors
Not gonna happen! Prices more up and interest more up and yearly tax more up!!! Everything is expensive in next generations!
Yeah but 3% SOUNDS good!
I would love 3% mortgage 😂
How would that help you ?
@@geoffmcarthy7314It would literally reduce the mortgage by 30%
Refinance?
@@JaBoss397 investment property.
@@geoffmcarthy7314 lower mortgage payments.
Great job explaining this so clearly. We don't need interest rate to go down to 23% just to 5.5 is decent to give us a balanced market
I appreciate how deep you go in your videos and the examples you use, I feel it is more detailed than other youtubers I follow
the cost was high, they said raise it to drop the price, but the price never drop, this was like 3 to 4 years ago. so now its 7% and high price. it didnt work, so drop the percent back is the best option. its the right move.
prices will go down when the demand is not there, that takes time, people who have seen and gotten the taste of selling them higher like in 2020 want to make that money still so are holding off on reducing their prices or holding off on selling until it drops to 3%, then hope to make more as bidding wars will break out.
You said the bank borrows from another bank to loan you money. Does that bank also have to borrow from another bank or are they borrowing from the Federal Reserve Bank?
What good is a 3% interest rate on a over priced house. The average small or starter house is $400k. The average person doesn’t make that with two working people. Banks are restrictive on who they lend based on credit score, salary and debt to income ratio. The fact that they even look at salary is a joke. Since a persons salary is not their take home pay due to all the taxes and benefits taken out. The net or take home pay for most people would not rationally allow for a loan on a $400k house. I haven’t seen a house under $200k since the late 80s early 90s.
0:02 Chat me up
houses prices are just too high, period! greed and making more profit keeps them that high as long as there is consistent demand, it will never drop! then you freaking pay more property tax too, thats a killer for me, period! Paying the government like $10K-$20k+ every yr? I dont even spend 1/5th of that on myself.
This was a great video educating what all influence the housing mortgage rate! 👍🏽 thanks for doing this!!
Jaspreet good analysis you must keep doing these types of vids cause there's a lot to process in the smart steps on how to own a home and getting a good deal, thank you for your videos and your dedication. It's highly appreciated.
I love the whole mustache and brave thing. much needed chuckle
16:58 - The idea that lower rates could actually increase housing supply is interesting. I hadn’t considered that so many homeowners are locked into their low rates and unwilling to sell.
I am one of them. Was looking at a bigger house a few months ago but the interest difference alone would add $1200/ month to the payment. The higher cost of the house emded up being inconsequential since that difference is split over 30 years.
I learned a lot 🙌🏽 thank you.
I am soooo glad i got my house in March, 2020 😊😊😊😊😊😊😊😊. 3% baby!!!!!
Same here, though I was May 2021. 2.875 for me
2.3 in 2021 for me
And now you’re stuck with that house
@@Sp8man00 Oh no, he's stuck with being a homeowner! Whatever will he do without the constant threat of rising rents? Oh my....
@@Sp8man00 lol is that not the point of owning ?
Thank you ❤
I'm curious what else the federal funds rate affects besides mortgage interest rates
...well, best plan of action is to be informed to make the right borrowing decision for yourself. Thank you for sharing this info😊
Hi mate so excited today just reached my goal of 400k since June2024 to Jan 2025 l thank GOD for the life and wisdom shared.
How did you manage to achieve that level of growth? I've been trying everything I can to improve my investments, l want to retire in a few years and I need a better diversification
It's Charlotte Gina Miller doing, she's changed my life.
The first time we had tried, we invested €14,000 and after a week we received €50,230. That really helped us a lot to pay our bills.
I'm new at this, please how can I reach her?
I'm celebrating £32K stock portfolio today... Started this journey with £3K.... I've invested no time and also with the right terms, now I have time for my family and life ahead of me.
He is very smart. I love lower interest rates
Thank you for sharing
You da man Jaspreet.
I am all in 😂. Currently at 4.25
Great video
Pra
Short answer... not unless everything crashes and they need to reduce it for cheap money
some parts are wrong. the mortgage has nothing to do with the banks and federal reserve rate. It's based on mortgage back security bond.
Thank you!!!!😊
I Hit $12,590 k today. Thank you for all the knowledge and nuggets you had thrown my way over the last week . I started with 3k last week now I just hit $12,590…
How please can you explain because I've been making a lot of looses trying to make profit trading.
Weekly trading is the best way of making money in the market due to lack of experience which resulted in loosing funds... But miss Bernila George, restored hope shes a good woman
Since meeting Expert Bernila George., I now agree that with an expert managing your portfolio, the rate of profit is high, with less risk.
Wow. I'm a bit perplexed seeing her been mentioned here also Didn't know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.
Really you people know her? I was even thinking that I'm the only one she has helped walk through the fears and falls of trading
This means nothing if the supply of housing doesn't increase to meet the demand.
The supply will increase if those home owners who have low rates finally sell
@@montrelfuller1328 how? Isn’t the true problem a lack of affordable “first homes”?
@@shawnpatton3795extremely low wages is a factor. They can’t afford a house on low income or gig wages. That’s why it’s an unaddressed epidemic of people living in their cars - which they consider their home. Low or inconsistent wages also leads to bad credit, gaps in employment, use of pay day loans, etc… Even if the supply were normal, a large percentage of people can’t afford a home
it would mean house prices would go up - a lot..
And any new home that is built is lacking the quality that houses once had.
We need more lower housing prices than mortgage rates. The mortgage rates is not the issue
Amazing video, Possible mortgage subsides, super compressive, cultural, 🤩🤩🤩🤩🤩
The government already does mortgage subsidies in various of ways. The government also bought a lot of mortgages from the last housing crash which it’s never done before in its history…. So they have a ton of mortgage back securities debt that they are trying to get rid of themselves and they can’t because there are not enough investors interested in a ROI from 3% loans or less. I love this channel but right now the creator is grasping for thoughts. If Trump doesn’t want to let people have their student loans forgiven in any way then what would make you think he’s going to help subsidize mortgages?
With lower interest will drive home value higher, when money is cheap everyone wants to buy houses, now everyone over bidding each other!!
In Belgium we do have
What would be the point of 3% mortgage rate if the prices will go up, thru the roof
As inflation grows, people’s mortgage payments won’t change. Eventually people will have an increase in pay making it easier to pay the mortgage.
Great summary! I live in Florida, and while there are so many factors to consider, as you mentioned, one other major factor are investors (i.e. Blackstone), who are now desperately unloading properties. This has already impacted inventory and prices.
I hope not. Prices would sky rocket.
I actually don’t know if they will. If anything current prices will be more affordable
2018-2019 had a very low mortgage rate as well, and housing prices did not skyrocket
A big reason as to why homes are locked up is because people can’t sell, AND a majority of transactions are cash
This video shows that when a scary looking guy puts down his Avtomat Kalashnikova , starts taking finance, we discover….. he’s actually a very an intelligent guy.
House price increases wasn’t all about mortgage rates. The main part was government grants to all businesses.
That would be awesome! To buy or ReFi..
Customer service… how often do you talk to your lender during the course of your mortgage. Not worth a higher interest rate.
Even if 3% Rates come back, it will be hard to justify giving up my 2.00% for 30 fixed rate mortgage!
Lol blind lead the blind
@@geoffmcarthy7314 lol what
It will definitely help me with building a house. That's what I'm waiting for.
2%? HODL
Stop trying to flex lol
Thank you so much for this! Now I understand that it’s not my interest rate, is the banks interest rates!!!!
It’s about demand and inventory……rates went to 8% at some point and people were/are STILL buying so house prices still haven’t dropped…. 3% rates would be awesome but I doubt that would ever happen, but the reason prices are still high is because people are still buying at 7% and until there is a slow in demand and a significant increase in supply prices will stay the same…..
You sparked one thing about lending, specifically credit cards. I have a whole wallet full of them. One gives me 5 cents off for gasoline at the place I fill my truck up when it needs gas. One gives me a small cash-back (3%-ish) every time I use it. One gives me a 5% discount at Lowe's every time I use it (and I have been using it a LOT lately on my fourth rental property rehab as a DIY project.) But EVERY credit card is paid off at the end of the month. Folks, get out of debt if you possibly can, and then use credit cards to your advantage.
I’m subscribed to this channel but I’m surprise I didn’t see any of your new videos until today. Odd. 😅
I love it! Turning our country around to make life better wow its surreal!
Otherwise buyer has to be willing to make a higher down payment to pay a lower mortgage or research buy ack programs.
Lower interest rate it could be a good thing for buyers sitting on the sidelines but somehow this has been a cycle cutting interest rates home prices are going up is there will be fabulous solutions cutting interest rates at the same time maintaining the housing prices???
Lower rates is one thing- highly over priced homes is another problem. A 100k home at 8%=$734.00/mo. A200k home at 4%=$886/mo. Greedy prices are a problem.
Yes!!! Exactly, when people say “lower rates” I’m like that’s cool, but what about these prices?
Ya but trucks are 100,000 how you going to get a house at 100,000
Not greedy just the going rate. If you don’t like it oh well lol
@@andreawahleithner9640 noone is buying them. They r sitting in lots unbought.
Greedy companies not paying employees a 2025 real wage is a bigger problem. Wages have been stagnant for about 40 years.
Supply is the core issue in my opinion.
3% on a 300,000 home or 3% on a 800,000 home? Long gone are the 300,000 home prices.
Nowadays it’s 7% on a 800k home.
Does the deficit or the debt influence treasury rate also? It seems to me (not an economist) that the more they need to borrow the better yield they need to offer. Not my area of expertise though, just asking.
What are the thoughts of not allowing corporations to buy up houses to rent out?
Yes! We just bought our first house after waiting for years and years in this market. The mortgage rate makes our payment very high. Yes we want mortgage rates to go 3% or even lower pls.
Jaspreet, as a travel investor and fan of your content, I love it. You are inspiring me to create a channel on how to travel and invest your money at the same time. Please teach more of your native language Punjab in your material when explaining your financial analysis. Thanks for everything man.
Why is the FED called like that if it's not federal nor a bank?😅
Mortgage rates also follow 10 year treasury not fed fund rate...which many think.
Unpopular opinion: Rates being 4-7% is absolutely normal. Haveing a 10% rate is as ludicrous as a 3%. Its unsustainable.
I (personally) think the sweet spot is 4-4.5% mortgages rather than 3-3.5%. This could influence enough people to sell. But should the government get involved in manipulating rates? No. Whenever the government gets involved in what should be market affairs, it always makes things worse
Those were the rates for a while prior to corvid. And there was no housing crisis
The government is the reason rates are high. They stuck the consumer.
3% sure is better than the current 6.5%
Get rid of Fractional banking
Not a chance they go that low with today's home prices. Prices would increase sharply again and not very many people can afford a $1,000,000 house even with 3% interest
But......if they (banks) use $ from savings accounts, then they don't pay to borrow money because of 0% interest Rates??
Not everyone has that kind of $$, so they have to borrow to buy a house, if that is what you were talking about
Lower rates would increase demand for HECMs and HELOCs. This would increase consumer spending which would help with the dynamics mentioned in the video.
Max all interest rates as much as possible
It doesnt matter anymore. You got people try to sell a beat down trailer for 300k.
Yes rates could get down to 3% by the government offering rate buy down programs for owner occupied housing (likely for more rural/less desirable areas) it should come with a 20% down payment requirement though. I think this could be a potential solution to make owning housing more affordable for families in the near term and help with overpopulation in urban areas.
Tariffs are inflationary, inflation is bad for interest rates
The only thing that is returning is the average annual appreciation of a home (3%). The days of home values increasing 37% in 2 years are gone forever (2020-22). However, it is likely that the cost of everything else you pay for will increase 37% over the next 4 years while you wonder everyday if your employer is going to fire you.
I do want to say you’re email every day is the only reason I enjoy checking my email every day
Hopefully not! Giving everybody mortgages by requiring little to no down payment is one of the main causes of hyperinflation. 🤓
RECESSION = 3% rate
DEFLATION = 0% rate
Inflation = 5-7%
Hyperinflation = 10%
I seriously hope Trump can and will do something about interest rates. I attended one of his rallies locally, and he also mentioned he wants to lower interest rates on credit cards as well. As someone who has been actively trying to payoff debt, this could be a game changer for so many Americans.
We need more houses to be built before the low mortages of 3 percent. 4.5 percent though, might help out before we build more.
I wish Canada had mortgage rates lockable to the full amortization of like 25 years, instead of just 3-5 years...
Not sure. I’m hoping for interest rates to drop so I’m able to refinance out if my 7.625%. I don’t believe rates will drop anytime soon.
Free markets don't adjust very quickly and the fact that Blackstone own so many homes and other institutional investors who bought them and sat on them to drive up the price by restricting home availability with supply-side economics created the rise in the valuation of the homes play now they want to exit those Homes at a higher evaluation and the only way for them to do it is by getting the interest rates back down because people cannot afford them at the higher rates and at the higher valuations at the income level that they have
I feel likes there's a trend not sale but to own, more people will just go out, buy an additional home rent it out, and buy a new one.
Inflation has scare people, home prices continue to rise so people will take more risk to own more properties.
Not in Cali 🎉
Higher price of houses makes it pointless.
Drop the price or raise wages insurance and taxes go along with house prices.
Yes, interest rates on loans for houses to go lower. US needs more houses.
We don't need 3% mortgages (I have a 1.83 BTW). We need home prices to crash 60%.
That's the bottom line and I say this as a homeowner tired of paying heavy insurance premia and property taxes.
True, only if there was no pro tax, I would be so happy!!! It sucks your hard erned money just draining away like that, especially on a home that is like $600k-$1 million, and that is not even a mansion or anything like that, just a 3-4 bedroom house in California. In the bay area, its 2-3 times that price for a tiny home!!! no thank you
If mortgage rates go back down to 3% I will charge 150% of what I paid for my home three years ago because idiots will be out buying anything they can get their hands on.
Just get them to 6! They hit 6 back in October and things were looking pretty good at that time. People were buying and new applications for purchase went up
Technically on every video is "nobody know what is going to happen' "Can go up and down" to cover both ways. 😂
I believe prices have to normalize back to 2020 levels before anything can happen. The risk will be that forbearance balances will default before it.
We need lower insurance. My insurance is just as much as my mortgage. After the storm so many house in my neighborhood went up for sell because insurance increase by hundreds. Running people out of their homes because we can no longer afford . In one year my note went from $1300 to $2400.
I'm closing on a property now I would love to refi immediately lol
I think he should lower rates it only makes sense to boost the economy and I think it would be very good for his approval rating and to make people happy also with the tariffs