September 10th: Real Estate Market Update

Real Estate Market Trends: September 10, 2024

Quiet Before Fed Meeting:
As the Federal Reserve prepares to meet next week, markets are optimistic about a possible rate cut. Homebuyer demand has picked up, but rising prices are keeping some buyers cautious. Lower rates are expected to further boost demand in the coming months, with more inventory gradually becoming available.

Labor Market Shows Improvement:
Job growth remains positive, and the labor shortage that has fueled inflation is easing. Fewer job openings suggest that inflation may continue to trend toward the Fed’s 2% target by the end of the year.

Interest Rates and Mortgage Trends:
Mortgage rates have improved, with the average 30-year fixed rate at 6.27%, a significant drop from earlier this year. VA and FHA rates have dipped below 6%, potentially unlocking more housing inventory.

Mortgage Applications & Sales:
Although still below peak levels, mortgage applications and pending sales have seen double-digit growth. Some regions, like the Central Valley, are outperforming others in demand.

Construction Slows:
Construction spending fell 0.3% in July, with single-family home building down 1.9%. However, lower interest rates may revive builder sentiment in the coming months.

Homebuyer Sentiment:
Despite more optimism about falling mortgage rates, homebuying sentiment remains flat, with only 17% believing it’s a good time to buy. However, with rates moderating, sentiment may improve soon.

(Source: California Association of Realtors)

As always, feel free to get in touch with me with any questions - I am happy to help you or your friends and family. 

- Anastasiya