[Music] Through the housing market may be Cooling off but many homeowners are Looking to get a better deal on their Monthly payments better deal it sounds Like a lot but applications for Refinancing a home loan they are up six Percent last week according to mortgage Mortgage Bankers Association mortgage Rates have fallen to their lowest levels Since September although they are still More than double what we saw around this Time last year we want to bring in now Mike frantantoni a chief Economist at The Mortgage Bankers Association good to Have you with us uh so I think a lot of People are struggling with their Finances right now and they feel Uncertain Answer this question is it a good time To consider refinancing or should you Just pause right now Well Jim and Lana thanks for having me On I think as you pointed out we are in A very different situation than we were Last year at this time uh beginning of 2022 mortgage rates for a 30-year loan We're at about three percent uh now We're at six point three percent but We've been above seven percent until About a month ago so wide range what Happened in 2020 in 2021 is that Millions of homeowners were able to Really realize substantial saving by
Refinancing what rates were at or near Record lows At this point more than 90 percent of Homeowners with a mortgage probably have A rate of four percent or below so 6.3 Is not going to be attractive for a lot Of folks that re-fance over the last Couple of years but for someone that Might have bought her home earlier this Year it could be a good opportunity so Many metrics to use to assess sort of Where we're at in the housing market Existing home sales we're down 7.7 percent in November that's a 10th Straight monthly decline so what needs To happen for the housing market to pick Up steam again Yeah so I'll start with really the most Important number we have which is if you Look at the demographics of this country We have 50 million people between the Ages of 28 and 38. that is really sort Of the heart of the peak age for First-time homebuyers and I expect over The next couple of years more and more Of the market will be taken up by those First-time buyers looking for a place to To call their own The challenge is we've got a weaker Economy now we're forecasting a reason For the first half of next year Unemployment rate is likely to rise wage Gains are likely to slow And then this year we've really been
Struggling with this spike in mortgage Rates beyond that the last couple years There just have not been a lot of homes On the market I would point to another number from That existing home sales report this Morning there's only about 3.3 months of Supply so it still is going to be a Challenge properties are staying on the Market a little bit longer I think some Are looking to buy this coming spring They're going to have a little easier Time finding a property than someone Looking a year ago but it's still a Relatively tight Supply in the existing Market we are seeing a bit more Supply On the new home portion of the market Builders uh you know put you know takes Time to from the decision to break Ground to when those properties are Ready for sale there are a good number Of properties that are currently under Construction let's talk about Builders Because the CEO of the National Association of home builders said in a Recent interview that we are in a Housing recession right now Um obviously part of this is by Design The FED is trying to cool down the Market especially the housing market do You think that we're in a housing Recession and do you see this overall as Where we should be as a nation Yeah so housing is probably the most
Interest rate sensitive sector portion Of the economy and when you look over The past several decades the typical Pattern has been the housing sector Leads the U.S into a recession and it Pulls it out so that's our expectation As well that absolutely the housing Market has slowed sharply over the past Five or six months we think again Potentially if rates continue to drop We'll get a little bit of a fuel uh to Help the housing market pull the economy Out of the recession we're forecasting As we get into the second half of 2023 All right Mike Frampton Tony thank you So much
