Currently Reading

How Mortgage Rates Affect the Housing Market

Advertisement
Housing Markets

How Mortgage Rates Affect the Housing Market

As mortgage rates go up, the housing rally slows down.


October 18, 2021
Real Estate Broker Business Meeting
Image: Stock.adobe.com

As the housing market gradually shows some moderation after a frenzied year for homebuying, housing analyst Ivy Zelman of Zelman & Associates predicts that a rise in mortgage rates will slow an overwhelming demand for new homes, according to Bill McBride in his CalculatedRisk Newsletter.

Zelman says: "I think the housing market is already starting to show some moderation. And I think that it is going to become even more evident as rates are starting to back up. And the continued upward pressure on home prices which is not sustainable is really impacting affordability.

If mortgage rates rise to 4%, the housing market will likely slow, but we saw 4% 30 year mortgage rates as recently as 2019, and the housing market survived. We even saw 5% briefly in October and November 2018, and new home sales slowed a little."

Read More

 

Related Stories

Financing

What Buyers and Sellers Can Expect From Rising Inflation

Demand-supply imbalance and inflated home prices are the new status quo, but for how much longer?

Financing

Fannie Mae and Freddie Mac Will Support Higher Mortgages in 2022

What an increase in conforming loan limits could mean for homebuyers

 

Financing

Mortgage Rates Expected to Rise Into the New Year

Forecasters anticipate an upward trend for mortgages in the final weeks of 2021

Advertisement
Advertisement

More in Category




Advertisement
Advertisement

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.