For more than a year, we watched the scalding-hot housing market with a mix of alarm (anyone who was just thinking of buying or selling), horror (anyone already deep in the process) and caution (economists everywhere). Now? Historically low mortgage rates have made a drastic turn upward, deterring potential buyers while putting an end to a flood of refinancings. Throw in inflation, war and ever-changing WFH expectations, and we’re looking at a far different landscape.
Not to make your day any worse, but the housing market cooldown will only lead to more dysfunction, says Conor Sen. The Federal Reserve last week raised interest rates in an effort to curb inflation, which already has consumers cutting back. The bright side? While the market is so far only showing signs of cooling, not a total bust, it’s a good idea for people who were considering buying a home to be patient, Conor wrote in an earlier column. The Fed, and the White House, have made inflation their top priority: “If housing market activity in the summer of 2022 is a casualty along the way, so be it.”