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“Although rates continue to fluctuate, recent data suggest that the housing market is stabilizing as it transitions from the surge of activity during the pandemic to a more balanced market,” Khater said. “Declines in purchase demand continue to diminish while supply remains fairly tight across most markets. The consequence is that house prices likely will continue to rise, but at a slower pace for the rest of the summer.”
Read more: MBA – “Purchase market continues to experience a slowdown”
Robert Heck, vice president of mortgage at Morty, agreed: “While mortgage rates have been reflecting the current state of inflation and the likelihood of more hikes for some time, we’ve seen the impact of new data and other announcements lessen somewhat over the past few months,” he said. “The inflation news could be seen as a positive macroeconomic sign, but it shouldn’t spur significant changes in mortgages or the housing market, which have largely been adjusted to the new reality. This could change if inflation suddenly rose substantially higher again, and the Fed remains committed to aggressively managing inflation so we could continue to see action even as inflation indicators point towards a slowdown in price appreciation.
“Homebuyers shouldn’t focus solely on this news when it comes to making a decision about whether or not to buy. While inflation drove the increase in rates over the past few months, key housing benchmarks suggest relative stability, indicating that the market remains healthy overall, even as activity has cooled and remains lower than last year. There’s no question that challenges remain for buyers and sellers, and positive inflation news won’t change that overnight.”
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