The US housing slump deepened this spring. Where does that leave home shoppers and sellers?
Why are potential homebuyers pausing their searches?
Potential homebuyers are pausing their searches due to several factors, including uncertainty related to the pandemic, high housing prices, limited available homes, and a desire to take more time searching for the right home or weighing their options. Additionally, some buyers are facing challenges such as job loss, increased competition, and bidding wars, leading them to reconsider their home search.
How has the US housing market performed this spring?
The US housing market experienced a slump this spring, with sales of previously occupied homes falling and mortgage rates remaining high, around 7%. Home prices have continued to rise, creating affordability challenges for potential homebuyers. Although a slight decline in mortgage rates is expected, it may not be enough to encourage homebuyers or persuade homeowners to sell.
What influenced the mortgage rates in 2024?
In 2024, mortgage rates were influenced by a combination of factors, including economic recovery, inflation, labor market growth, and the Federal Reserve's monetary policy6. Stronger-than-expected data on inflation and the economy led to higher mortgage rates, while a weaker jobs report caused rates to decrease. Additionally, the bond market, particularly the 10-year Treasury yield, played a significant role in shaping mortgage rates.