Our favorite economist, Dr. Lawrence Yun, Chief Economist for the National Association of REALTORS® stated:
“Inflation eased slightly in July, which could bode well for the housing market in the months ahead. Overall, inflation slowed from 9.1% in June to 8.5% in July, but prices for food and rent continued to climb, the Bureau of Labor Statistics’ Consumer Price Index showed Wednesday. Still, the slight deceleration suggests that consumer price inflation may have peaked, which suggests that mortgage rates also may have peaked. The level of inflation is still high and uncomfortable but may indicate the start of a steady retreat. Rents continued to rise in July, up 6.3% compared to a year prior, the CPI showed. “That is a testament to the ongoing housing shortage.
The worst of sky-high inflation could be behind Americans. If there is a sustained decline in gasoline prices and more production of apartments and single-family homes, consumer prices will pull back, encouraging the Federal Reserve policy to be less aggressive. Mortgage rates will fall. On Wednesday morning, the 10-year Treasury yield stood at 2.7%. That should translate into 30-year mortgage rates pulling back to under 5%. Some recent potential home buyers who were pushed out of the market may now be able to get back in and qualify for a mortgage.
We know you have been inundated with negative headlines about shifts in the current housing market, and they can be overwhelming to listen to and read. What those news pieces don’t often account for, though, are how the markets are operating on a local level. The good news, though, is that we are here to be your guide!
If you have a specific neighborhood in Arizona that you’re interested in learning more about, please let us know, and we would be more than happy to put together a report on that area for you. It’ll include average sales prices for that neighborhood, days on market, and community information.
No matter the questions you might have about this current market, we are here to help. Have a pleasant day.