The lending market fluctuates on a regular basis. There are many factors that impact the current rates. Our experienced mortgage lender in Osage Beach, MO keeps up with the daily changes that impact our clients. If you're thinking about purchasing a home at Lake of the Ozarks or refinancing your home in the near future, we'd love to chat about what the current rate situation can mean for you and your loan. Check out a recent update from Mortgage Market Guide to learn more about the current market conditions:
A few weeks ago, some weak economic signals sparked increasing fears of a recession. Let's walk through what happened and look ahead to the future.
"While the Present Situation Index was relatively unchanged, the Expectations Index continued its recent downward trajectory - falling to its lowest point in nearly a decade. Consumers' grimmer outlook was driven by increasing concerns about inflation, in particular rising gas and food prices. Expectations have now fallen well below a reading of 80, suggesting weaker growth in the second half of 2022 as well as growing risk of recession by year end." The Conference Board's Consumer Confidence Report.
This reading is important because if pessimism begins to negatively affect consumer spending, the chance of a recession will rise sharply as consumer spending makes up two-thirds of our economic growth.
A few weeks ago, the third and final reading of 1st Quarter GDP showed the economy shrank by 1.6%, worse than expectations of -1.5%. A recession is defined by two quarters of negative growth. The 2nd quarter is forecasted to barely grow, which means we will be in or close to a recession in the 1st half of 2022.
The silver lining about all this recession talk? It will put a limit to how high rates go. We are two weeks past the 3.49% peak in rates which ironically happened when the Fed raised the Fed Funds rate by .75%.
Bottom line: Long-term rates have stabilized but we should not expect much more improvement until inflation moderates further. With that said, if you are interested in purchasing a home, it remains a great time with rates beneath the rate of inflation.
Looking Ahead
We will receive important employment readings by way of the ADP Report and Jobs Report. The Fed wants to slow down the labor market and we have already seen layoff announcements in corporate America, so we will see if that is reflected in the coming week's figures.
We know the interest rates can seem intimidating to navigate but we've been in the industry for over 20 years and we're confident as we navigate these changes. Put our experience to work for you as you plan to buy a home at Lake of the Ozarks. If you're ready to learn what kind of rate you qualify for you, give Team Lasson a call at (573) 746-7211 or visit our website at www.yourlakeloan.com!
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