This
photo
taken
on
Aug.
22,
2023
shows
an
advertisement
in
front
of
a
real
estate
for
sales
in
Millbrae,
California,
the
United
States.
The
sales
of
previously
owned
homes
in
the
United
States
dropped
2.2
percent
in
July
from
June
to
a
seasonally
adjusted,
annualized
rate
of
4.07
million
units,
the
National
Association
of
Realtors
reported
Tuesday.
Sales
were
16.6
percent
lower
compared
with
July
of
last
year,
while
homes
were
sold
at
the
slowest
July
pace
since
2010.
(Photo
by
Li
Jianguo/Xinhua
via
Getty
Images)
Xinhua
News
Agency
|
Xinhua
News
Agency
|
Getty
Images
The
average
rate
on
the
popular
30-year
fixed
mortgage
crossed
over
7%
on
Monday
for
the
first
time
since
December,
hitting
7.04%,
according
to
Mortgage
News
Daily.
It
comes
after
the
rate
took
the
sharpest
jump
in
more
than
a
year
Friday,
after
the
January
employment
report
came
in
much
higher
than
expected.
Rates
then
moved
up
even
more
Monday
after
a
monthly
manufacturing
report
came
in
high
as
well.
Mortgage
rates
have
been
on
a
wild
ride
since
the
summer,
briefly
crossing
to
a
20-year
high
of
8%
in
October.
Rates
then
fell
sharply,
as
investors
saw
more
and
more
evidence
that
the
Federal
Reserve
would
end
its
latest
phase
of
interest
rate
increases.
Mortgage
rates
do
not
follow
the
Fed
directly,
but
they
follow
loosely
the
yield
on
the
10-year
Treasury,
which
is
heavily
influenced
by
the
central
bank’s
impression
of
the
economy
at
any
given
time.
“The
rapid
increase
in
rates
over
the
past
two
days
is
actually
not
too
surprising
given
the
fact
that
the
market
was
widely
seen
as
overly
optimistic
on
the
Fed
rate
cut
outlook. The
Fed
has
repeatedly
pointed
to
economic
data
having
the
final
say
in
that
outlook
and
data
has
been
shockingly
unfriendly
to
rates
as
of
Friday
morning’s
jobs
report,”
said
Matthew
Graham,
chief
operating
officer
at
Mortgage
News
Daily.
As
mortgage
rates
fell
over
the
past
two
months,
buyers
seemed
to
be
returning
to
the
market.
That
coincided
with
a
slight
uptick
in
the
number
of
homes
for
sale.
Total
inventory,
however,
is
still
historically
low
and
is
keeping
competition
high.
It
is
also
keeping
home
prices
stubbornly
hot.
High
prices
and
low
supply
combined
to
make
2023
the
worst
for
home
sales
since
1995.
Most
predict
2024
will
be
better.
“The
strong
job
market
is
good
news
for
the
spring
buying
season
as
higher
household
incomes
are
a
necessary
component,
but
it
also
means
that
mortgage
rates
are
not
likely
to
drop
much
further
at
this
point,”
said
Michael
Fratantoni,
chief
economist
at
the
Mortgage
Bankers
Association.
Mortgage
applications
to
purchase
a
home
had
been
rising
steadily,
but
fell
back
in
the
last
few
weeks,
as
mortgage
rates
edged
higher.
With
the
all-important
spring
housing
market
closing
in,
rates
are
more
important
than
ever,
given
high
and
still-rising
home
prices.
The
median
price
of
an
existing
home
sold
in
December
(the
most
recent
data)
was
$382,600,
according
to
the
National
Association
of
Realtors,
an
increase
of
4.4%
from
December
2022.
That
was
the
sixth
consecutive
month
of
year-over-year
price
gains.
The
median
price
for
the
full
year
was
$389,800,
a
record
high.
Given
how
high
prices
are,
even
small
rate
swings
are
having
an
outsized
effect
on
monthly
payments,
which
are
the
final
determination
of
affordability.
Just
a
half
percentage
point
swing
can
cost
or
save
a
buyer
more
than
$200
a
month
on
the
median-priced
home.
So
what
next?
“The
future
of
rates
in
2024
is
all
about
ifs
and
thens,”
said
Graham.
“If
we
see
more
data
like
last
Friday’s
jobs
report,
rates
will
have
a
hard
time
getting
back
below
7%. But
inflation
is
even
more
important
than
the
labor
market.
If
inflation
comes
in
cooler
than
expected,
it
could
balance
the
outlook.”
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