UK mortgage borrowers are in for a nasty shock from soaring rates

London CNN Business — Millions of mortgage borrowers in the United Kingdom they are preparing for big increases in their monthly payments as a result of the run on the pound. Markets have been in turmoil ever since UK finance minister Kwasi Kwarteng announced the biggest tax cuts in 50 years on Friday, along with … Read more

Home buyers are canceling purchase contracts. What to know before you do

Steve Pfost | News | fake images Amid higher interest rates and a weakening housing market, homebuyers continue to back out of purchase contracts at a high rate. Some 64,000 home purchase deals were canceled in August, according to a new report from Redfin. That is equivalent to 15.2% of housing contracts started during the … Read more

The fundamental reason house prices will fall this fall

The prices that people expect tomorrow influence today’s demand and supply. Economists say that “fundamental” economic factors, such as interest rates and family income, determine home prices. For some unknown reason, economists don’t consider people’s expectations of future house prices to be a major factor in determining current house prices, but they should. Economists have … Read more

U.S. housing starts rebound in August on new apartment construction

The numbers: US new home construction rose 12.2% seasonally adjusted in August to 1.58 million, the Commerce Department said Tuesday. The increase in home construction reverses a sharp drop in July, where housing starts fell a revised 10.9%. Economists surveyed by the Wall Street Journal had expected housing starts to rise at a rate of … Read more

Housing market peaked, now in correction: Moody’s economist Mark Zandi

moody’s Analytics Chief Economist Mark Zandi is ready to give you a call. He says Fortune that we have officially gone from a housing boom to a “housing fix.” “The housing market has peaked…everything points to a turnaround in the housing market,” says Zandi. “In terms of home sales, they are falling sharply. Housing demand … Read more

Speedy escape from housing market slump unlikely: ARMs tied amid low rate lock-up

Home sales, construction volumes and now even home prices in many markets (the last shoe to drop in a housing correction) are falling. Clearly, the fact that mortgage rates have soared from a low of 2.6% in December 2020 to six percent in early September is holding many would-be homebuyers in the grips. The last … Read more

‘Extreme buyer hesitation’ is pushing home sellers to pivot to renting instead of selling

Facing weak demand from home buyers, home builders and sellers are increasing their focus on the rental market. And that’s probably good news for renters. Home sellers face a tough market. The 30-year interest rate slips past 6%, according to Daily Mortgage News TuesdayCompounded by recession fears, they are holding back buyers. Sellers are, as … Read more

Where the U.S. housing market goes next, as told by two charts

This spring, the Fed dusted off the old inflation-fighting playbook. It goes like this: the central bank applies upward pressure on long-term interest rates, including mortgage rates, signaling that short-term rates will soon rise. Those rising mortgage rates push both home sales and home construction down. That’s causing demand for staples (like lumber and concrete) … Read more

Million-dollar homes lose luxury status as buyers get less space

A for sale sign in front of a home listed for more than $1 million on April 29, 2022 in San Francisco. justin sullivan | fake images Grocery shoppers aren’t the only ones dealing with phenomenon known as “shrinkflation”, which is what happens when the price of something stays the same or goes up even … Read more

Mortgage rates rise again after Fed says it will take ‘forceful’ steps to curb inflation

CNN — Mortgage rates continued to rise this week following comments from Federal Reserve Chairman Jerome Powell that the central bank is taking “strong and swift” action to reduce inflation and slow the economy. The 30-year fixed-rate mortgage averaged 5.66% in the week ending Sept. 1, up from 5.55% the week before, according to Freddie … Read more