Why mortgage rates may rise if the Fed cuts by 25bps: Redfin CEO
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- Опубліковано 7 лют 2025
- The average rate for a 30-year fixed mortgage was flat at 6.35% for the week ending September 5, according to data from Freddie Mac. Redfin CEO Glenn Kelman (RDFN) says that homebuyers are very slowly responding to the drop in rates, saying he has "never seen buyers respond so sluggishly to low interest rates." Kelman attributes the lag to a few different factors, including waiting to see what the Federal Reserve will do at its September meeting. However, he notes that "mortgages have already priced in at least a quarter-point cut, and if that is all that we get, we might actually see mortgage rates increase, whereas if we get a 50 basis point cut, rates will drop further." Another contributing factor, he says, is the lack of listings, with some areas having stale inventory. What will it take to get the housing market moving?
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"If you stimulate supply without stimulating demand is.just going to cause home prices to rise " ?
It will actually cause a surplus in homes, and a surplus causes prices to fall. Basic economics.
One problem is new construction is mostly mcmansions because they get the biggest bang for the buck for builders. But they also cost the most for home buyers. Nearly no one is building more affordable homes in the 1500 to 2500 square foot range anymore. Not because they wont sell, but because the profit margins not a big.
oh my God, a reasonable and smart person talking about housing on government finance. first time ever
They did not take into account how inflation over the past 2 years has errored most potential buyers savings for a down payment. On top of that most were living on credit cards during this time when they didn't see much of a wage increase so they either were at their debt to income ratio limits or have blown past it.
Simply put, even now, American homes are massively undervalued compared to Europe, Canada, UK, and Australia. With rising land, labor, and input costs, along with rising immigration levels and purchasing power I don’t see American home prices falling or even remaining steady for the next 10 years.
Surprised with rates so low??? The current generation is used to rates 4% or less...they are holding out until rates go back to that.
The price is still too damn High. No one's interested in a zillion dollars of debt even if the interest rate is low
First time home ownership is OVER in the US
Another video explained. When fed gives up on inflation, lenders will demand higher return on bills to compensate the inflation.
Absolutely
Rates low??? Lol
Compared to what most people have, no!
Bidenflation 🐫ela inflation