In 2013, mortgage rates rose from 3.5 to 4.5 percent because the Federal Reserve pulled back its mortgage-backed securities purchase program. This year, rates have risen due to economic growth.
John Burns Real Estate Consulting broke down the differences in the context behind the rate hikes in 2013 and today. Four years ago, unemployment rates were higher, consumer confidence was lower, and oil prices were more expensive.
While new home sales fell 8 percent in 2013, housing demand is more resilient today. New home sales have improved 14 percent year-over-year through February, and several markets such as Dallas, Seattle, and Nashville can be considered “hot.”
Advertisement
Related Stories
Economics
Housing Share of GDP in Q1 2024 Rises Above 16%
The increase marks the first time GDP has surpassed 16% since 2022
Economics
Shelter Costs Drive Inflation Higher Than Expected in January
January Consumer Price Index data show inflation increased more than anticipated as shelter costs continue to rise despite Federal Reserve policy tightening
Economics
Weighing the Effects of the Fed's and Treasury's Latest Announcements
The upshot of the Jan. 31 announcements is that while mortgage rates will stay higher for longer, they're likely to hold steady