Are 4% mortgage rates gone forever?

Plus, a home with a flair for the theatrical

͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌  No images? Click here February 17, 2024 • Issue #129 Happy Saturday! This week, we’re looking into whether buyers should wait for a 4% mortgage rate to come back and an entertaining home in Wisconsin.

Are 4% mortgage rates ever coming back?

Money, Getty Images A few weeks back, a reader sent in a question potentially sparked by the recent small dip in mortgage rates: Will rates get back to 4% within the next couple of years? My answer was simple: I didn’t believe rates would go that low in the next two years. However, at the time (a mere three weeks ago), I did think there was a chance rates could drop below 5% within the next five years. I reasoned that the Federal Reserve would hold the federal funds rate steady for now and start cutting in March, a scenario many analysts were expecting. That would help push mortgage rates lower over time. But recent developments have me rethinking my position. First, the Fed signaled that although it is still contemplating reducing the federal funds rate this year, the first rate cut will happen later than everyone had anticipated. Then, there was talk that the Fed could instead decide to resume rate increases since the economy was doing much better than expected, and that could reverse the recent downward rate trend. Finally, this week we had a report showing that the January inflation rate was higher than anticipated. Needless to say, hopes of an early-in-the-year Fed rate cut were definitely dashed at that point. Since I had been so (wrongly) optimistic in my initial assessment, I decided to get an expert’s take on the chances of seeing rates that low in the next three to five years. According to Lisa Sturtevant, chief economist at Bright MLS, there’s “virtually no chance that mortgage rates will go as low as 4%” in that time frame. The only way rates could fall that much within a relatively short period of time is if the economy sank into a deep recession, Sturtevant tells me. And with a strong jobs market and inflation slowly (okay, very slowly) coming back under control, that situation is highly unlikely in the near future. Instead, she says, “We are in a new era for mortgage rates, where rates around 6% will be the norm.” So for any prospective homebuyers out there waiting for rates to drop to make a move, you might be waiting for a while.

Optimism About Mortgage Rates Reaches a Record High

Are Adjustable Rate Mortgages a Good Move Right Now?

Listing of the week Andy Fabitz, Bitz Productions Raise the curtains! Known as the “Diversion House,” this ranch-style home was originally built in 1969 and designed to suit the very particular taste of its owner (a theater-lover, if you can’t tell). If you’ve ever dreamed of being onstage, this is your chance. The finished basement features your own personal theater, complete with a stage and plenty of seating for a captivated audience. There’s also a wet bar, two dens and a “projection room” (there are real projectors and film reels in there). The main level of the home features three bedrooms and two bathrooms, with a small deck leading off the primary bedroom. There’s also plenty of yard space for an aftershow cocktail or two. The home is located in New Berlin, Wisconsin, (close to Milwaukee) and has never been listed before, so you have the chance to own a true original. Contact the Hupke Team at (262) 613-2548 and you can make your Broadway dreams come true for just $424,800. Andy Fabitz, Bitz Productions ’Til next time, P.S. Have you seen a unique listing on social media I should feature in this newsletter? Or have a question about housing or mortgages you desperately want answered? Let me know on Twitter at @LeslieLCook or via email at leslie@money.com. P.P.S. Have a friend who loves real estate or is looking for a home of their own? Please forward them this email or send them to the Money Moves subscription page. Money’s Essential Home Buying Resources: Winter On the hunt? Check out Money’s Mortgage Calculator, list of The Best Mortgage Lenders and look at the latest mortgage rates. Thinking of refinancing? Our list of The Best Mortgage Refinance Companies can help. You can also use our Mortgage Refinance Calculator or these refi tips. Key question: How much house can I afford? This newsletter is free because Money earns a commission when you click or make purchases from the links in this email and on our site. We also receive compensation for some of the products and services featured in this message. Offers may be subject to change without notice. Learn more about how we make money. Privacy Policy • Advertise With Us • We're Hiring! To stop receiving these emails, unsubscribe or manage your email preferences. Copyright ©2024 Money Group, LLC. All rights reserved. Metro Office Park Calle 1, Building 7 Suite 204, Guaynabo, Puerto Rico 00968, USA