The US housing slump deepened this spring. Where does that leave home shoppers and sellers?
What caused the US housing slump to deepen this spring?
The US housing slump deepened this spring due to a combination of factors, including high mortgage rates (averaging above 7% for a 30-year home loan), record-high home prices, and a historically low inventory of homes on the market. These factors have contributed to affordability challenges for homebuyers, leading to a weak spring homebuying season and a gloomy outlook for the summer and fall.
How have mortgage rates affected home buying in 2024?
In 2024, high mortgage rates have significantly impacted home buying, with rates above 7% pricing out many potential buyers. The affordability challenge has been exacerbated by record-high home prices and low housing inventory. Although rates are expected to ease modestly by the end of the year, it may not be enough to entice home shoppers or persuade homeowners to sell.
What are economists' projections for mortgage rates by year-end?
Economists project that mortgage rates will ease modestly by the end of this year. However, most economists don't expect the 30-year fixed rate to fall below 6% until 2025. The average rate on a 30-year mortgage is currently at 6.95%, more than double where it was in early July of 2021.