Queens NY Real Estate Market Alert: Why Mortgage Applications Are Surging and What It Means for You
If you’re in the market for a mortgage, you might be interested to know that interest rates have been declining for the past few weeks. In fact, mortgage activity has increased for the third week in a row, according to the Mortgage Bankers Association (MBA).
Mortgage Activity Increases for Third Straight Week
The MBA’s Market Composite Index, which measures mortgage loan application volume, showed a 3% increase in activity on both a seasonally adjusted and unadjusted basis. And while refinancing accounted for just over 28% of applications, it was up 5% from the previous week.
Now, you might have heard that the Federal Reserve was considering hiking the Fed Funds Rate. And while they did end up increasing it by 0.25%, markets were actually betting that the Fed would cut rates by 0.75% by the end of the year. However, the Fed’s recent forecasts show that they’re planning to keep rates about the same through 2024, and even increase them slightly.
Federal Reserve Increases Rates, but Mortgage Rates Fall?
Despite all this, Treasury yields (which are a benchmark for mortgage rates) and mortgage rates themselves actually fell after the Fed made its announcement. How can that be? Well, it turns out that the Fed Funds Rate doesn’t directly affect mortgage rates, and Fed Chair Powell’s recent comments about tightening lending conditions may have spooked investors a bit.
How Lending Conditions Impact Inflation and Mortgage Rates
Lending and credit are super important for economic growth and inflation, and if lending becomes more restricted or there are fewer loan programs available, it can put downward pressure on inflation. That’s actually part of the reason why rates have been staying high. So when Powell hinted at tightening lending conditions, investors may have become worried about what that could mean for the future.
Will Low Mortgage Rates Last in the Queens Real Estate Market?
Long story short, mortgage rates dropped by almost a quarter point in some cases, which is great news for borrowers. But it remains to be seen if this is just a temporary relief or if we can expect rates to stay low for a while. We’ll have to wait and see what the data shows and whether or not there are any additional banking issues in the future.
Take Advantage of Low Mortgage Rates While You Can!
So, what does this all mean for buyers in the Queens real estate market? Well, if you’re planning to buy a home in the near future, it might be a good time to lock in a low mortgage rate while they’re still available. With rates on the decline, you could potentially save a lot of money in the long run. Of course, you’ll also want to keep an eye on any changes in lending conditions and other economic factors that could affect rates down the line.
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