Mortgage Rates Fall Even Further

We’re starting off December on quite a low note… lower rates that is! That’s right we just had another great week of mortgage rates trending downward to end the month of November and kick off the month of December right during the holiday season. And no better gift could be given for homeowners right now than lower rates  we are now seeing compared to the highs of October. Mortgage rates last week revisited their most recent lows that we haven’t seen since September of 2023. And now we are seeing homeowners take a very close look at how they can tap into their equity and use it to maximize their financial position and even pay off debts – whether it is through a cash out refinance or a home equity line of credit. Either way, there has been a substantial uptick of home owners accessing home equity in the last several weeks. If that sounds like, you drop us a DM or comment on this video so we can help.

There is a second reason to already celebrate in the month of December. That’s the announcement of the baseline conforming loan limits for mortgages backed by Fannie Mae and Freddie Mac. For 2024, the new conforming loan limit will be increased to $766,550. This is a substantial increase from the current limit of $726,200 and represents a 5.5% increase in 2024. Which if you think about it closely, is an admission that the markets are either catching up with home prices still or that they are anticipating home prices to hold or even increase in new year. Yes home prices are likely to hold and maybe even increase in the new year. Mortgage rates falling and the housing agencies increasing their loan limits together conspire to validate this line of thinking. So those of you looking to buy a house in 2024, great news you’re going to be able to qualify for a conforming loan limit much higher than you would have in 2023.

And we have to talk about pending home sales real quick. Pending home sales in October dropped to the lowest level since the national association of realtors began tracking this data in 2001. With the sharp rise of mortgage rates in October the 30 year fixed loan briefly touched 8% levels and I think caused a real shocking eye opener for some people which ultimately led to less homes hitting the market. Historically when rates increase there is a slight uptick of inventory that hits the market in order for people to beat the future higher rates upon moving. But what happened this time looks like we hit a glut of inventory with the least amount of homes hitting the market even compared to the global financial crisis of 2008 and 2009. But don’t lose heart, all of that is behind us by several months now and all forecasts that we see are calling for more inventory to show up in 2024 as people adjust to the new normal of rates in the sixs and sevens for the foreseeable future.

So with that, let’s take a quick look at what’s coming up in the markets this week.

Tuesday:  ISM services PMI and JOLTS Job Openings come out

Wednesday: ADP non-farm employment change is released

Thursday: we get unemployment claims

Friday: is the big guy just days before the final Fed meeting of the year….we have Average Hourly earnings month over month, non-farm employment change, unemployment rate, and the preliminary consumer sentiment reading all coming out to finish the week. It’s expected that the Fed will know all this in advance, and should NOT change any rate determination they have coming up for us on Wednesday December 13th.

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