So when’s the housing bubble bursting?

The appraisal came back $5k more than our offer, so we’re going with equity. I was going to wait to lock my rate after the next fed decision but if I do, it’ll affect my closing date.

Wifey and I have already discussed if the rates go a percent or more lower than where we are at, then we’ll refinance. I’ll bite the bullet on closing cost again if it means I’ll save a couple hundred a month.

Closing is September 27th.
 
4 Dimensional said:
The appraisal came back $5k more than our offer, so we’re going with equity. I was going to wait to lock my rate after the next fed decision but if I do, it’ll affect my closing date.

Wifey and I have already discussed if the rates go a percent or more lower than where we are at, then we’ll refinance. I’ll bite the bullet on closing cost again if it means I’ll save a couple hundred a month.

Closing is September 27th.
Click to expand...

FWIW, the market is already pricing in a rate cut so the rates shouldn't nose dive next week when they actually cut rates.
 
4 Dimensional said:
The appraisal came back $5k more than our offer, so we’re going with equity. I was going to wait to lock my rate after the next fed decision but if I do, it’ll affect my closing date.

Wifey and I have already discussed if the rates go a percent or more lower than where we are at, then we’ll refinance. I’ll bite the bullet on closing cost again if it means I’ll save a couple hundred a month.

Closing is September 27th.
Click to expand...
How long would you have to wait to refinance?
 


The 30-year fixed might fall another .60% just from market normalization, i.e. typical spreads.

That alone could push the going rate to ~5.75%.

Throw in a lower 10-year yield thanks to a cooling economy, say closer to 3%, and you might have a 30-year rate in the high 4s next year.

Fed is somewhat priced in, but maybe not all the way given the projected 250 bps of cuts by Sep. '25.

It's *possible* those paying points could see rates down to high 3s on vanilla scenarios by then.

Will be interesting to see what that housing market would look like.

Is it a frenzy again or do rates that low this soon imply ugly economic conditions?
 


Homebuyers and Realtors often believe the Fed Meeting is a catalyst for mortgage rates dropping. The reality is, by the time the Fed makes a move, the market has already priced that in...and then some! Today, the 2-Yr UST is a full 2% lower than the FFR. Mortgage Rates are about 1.5% lower than the early May '24 high.

Mortgage Bond Premiums are fattening up (more premium). However, higher rate coupon GNMA bonds (FHA/VA) seem to be underperforming UMBS (Fannie/Freddie), which is a sign (to me) that the market believes the bottom is not yet in for mortgages.
 
DC_Dude said:
Smart move. Nice area.
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I ran the decision through Gemini (paid version) a couple nights ago; the foundation question was based on home value increase over the next decade (based on economy, competition, market, location, etc).

I recommend using these types of systems as decision support tools.
 
Rah said:
I ran the decision through Gemini (paid version) a couple nights ago; the foundation question was based on home value increase over the next decade (based on economy, competition, market, location, etc).

I recommend using these types of systems as decision support tools.
Click to expand...
Facts. That’s actually very smart to do.

My mom’s mentor son has been renting his place out in Woodbridge for probably the last 30 years. Paid off townhome and because he is ex military he usually rents it out to military folks stationed at Quantico.
 
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