You’re probably too busy enjoying (what should be) your first mask-free weekend to even read this, but here’s what you’ll want to know about the latest in the mortgage and housing markets.
1. How to understand the housing boom
Real estate is a key driver of economic activity in the U.S., and the boom and bust cycle of homeownership largely mirrors what’s going on in the broader economy. During the coronavirus pandemic, real estate was a key sector that kept the economy relatively stable, but its strength also had the drawback of preventing new people from entering the housing market.
2. Competition among mortgage lenders is a boon to borrowers
If you’ve ever wanted to understand how lenders set mortgage rates, you should check this piece out. It’s a good reminder of just how favorable the climate is for borrowers right now. With banks and others competing for your business over already historically-low rates, it’s a great time to be in the market for a loan.
3. Is the refinance window closing?
Regular readers know this has been a key question for the past many months. With interest rates rising again — after receding for the last five weeks — it’s again time to ask how much longer you have to refinance at ultra-low rates. The short answer is: it depends. By historical standards, rates will remain generally low for some time, but they’re moving away from record-breaking numbers for sure.
4. Don’t time the mortgage market
Listen, in the abstract it would be great to wait for the lowest mortgage rate you’ve ever heard of before you refinance or take out a new loan. In reality, that’s almost impossible to do and it may never happen, especially now that rates are rising. You’re better off just finding a rate you’re happy with, which will give you a loan you can afford, and go about your life without stressing over a few basis points.
5. What is an accessory dwelling unit?
The current housing shortage coupled with the pandemic-driven changing needs of many homeowners has made accessory dwelling units, granny flats, carriage houses or whatever you want to call them newly popular. These independent living units within a larger house or on a piece of property can be a great flex space, and may even be one way to address the limited available housing supply.