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All right, thinking of buying a house in this economy? Well, the average rate for a 30-year fixed-rate mortgage hit a 9-month high of 6.53% this week. Summer is a hot time to buy. So, what do you do if you're in the market right now? Let's go ahead and bring in Jake Cruemmel, a senior economist over at realtor.com, for some answers. Jake, it is good to see you. Thanks for being here. Thank you so much. Absolutely. All right, so housing costs are on the rise right now, obviously. So, when you couple that with other affordability issues that people are dealing with, is this just a historically bad time to buy?
Well, I guess it kind of depends on your perspective. So, what we've seen this spring in the housing market is that the market has really faced a real stress test. So, you know, lots of things are really breaking against home buyers right now. Rates are up, as we saw, over 50 basis points since February. Inflation is at 3.8%, and you know, consumer sentiment is really low. And normally, when you see those things, the market freezes. But, that's actually not what we've seen this spring. Um, it's kind of been a resilient market we've seen. It's been the most active housing market for buyers and sellers since 2022, actually. Um, we've seen new listings um up to higher levels than expected. Contract signings, so uh
actually people buyers and sellers coming together. Um, those are up 4% year over year. So, I would say the market is passing this the stress test right now. Maybe not with flying colors, but it's passing, and that's a bit of a pleasant surprise for us who watch the market on a daily basis. Yeah, that's just so interesting. So, if you've been a prospective buyer sort of stuck on the sidelines for the past few years, what do you do? Like, do you see things getting better anytime soon? So, I mean, the short answer is it does depend on where you are, of course. Mortgage rates are national, housing markets are hyper local. So, it does depend on your current market. If you're in, you know, the West or the South,
you're actually looking at a quite uh you know, a buyer's market in a lot of these cases where um buyers have a lot more leverage than they had in the past. That's a little less the case in the Northeast and the Midwest, but I would say that again looking at perspective and where we the market has come from as far as affordability goes, this is the most buyer-friendly spring in about 4 years. So, there's more homes on the market and we're actually sealing seeing sellers cut prices or sorry, we're seeing prices lower on a annual basis in 35 of the top 50 markets. So, we're seeing that sellers are actually playing ball this year and that wasn't the case in the past.
Okay, so also here new Fed chair Kevin Warsh is about to hold his first meeting as head of the central bank. President Trump publicly pushed the Fed to cut those rates. What are you watching for right now? So, I mean the biggest thing as far as, you know, all of that goes is the conflict in Iran. So, that's really upstream of everything that's important when it comes to housing, the Fed and consumers. So, it's all about what's happening with gas prices, what's happening with inflation and what's happening with economic uncertainty. And right now it makes it a really difficult time think about cutting mortgage rates, especially if bond markets are going to react negatively to that, which would actually push potentially mortgage rates
even higher. So, the Fed is in between a rock and a hard place right now and I wouldn't expect mortgage rates as a result to go down really anytime soon. Not down to those sub-6% levels that we saw earlier this year, but at the same time if the conflict does get under control, that will help with you know, inflation, it'll help with economic uncertainty and that can help the housing market to sort of steady and get back on this resilient track that it's been on so far. It's truly incredible how connected all of those things are. All right, Jake Climent, thank you so much.
