Mortgage Rates Rise for Second Week in a Row

February 17, 2023

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What you should know:

US mortgage rates have risen for a second week in a row, with the average 30-year fixed rate now at 6.32%.
Consumer spending is helping the US economy remain strong despite inflation remaining high.
The Federal Reserve has been raising rates to cool the economy and bring down stubborn inflation.
The average long-term rate hit a two-decade high of 7.08% last fall as the Fed raised its key lending rate.
Expectations for inflation, global demand for US Treasuries, and the Federal Reserve's interest rate policy can influence borrowing costs for homes.

U.S. housing market sees uptick in activity, but experts warn of ongoing slump

The US housing market experienced an uptick in activity at the start of 2023 due to lower mortgage rates and the start of the busy season.
However, mortgage rates have risen again, making it harder to escape the ongoing housing market slump.
Recent economic data suggests it might take longer than expected for the Federal Reserve to tackle inflation, which is putting upward pressure on long-term rates like the 10-year Treasury and mortgage rates.
Homebuying activity was still in the gutter, and January’s slight rebound in buying activity hasn’t stopped the bifurcated home price correction.
The US housing market can sustain a recovery if housing affordability improves, which can be achieved through rising incomes, falling home values, and falling mortgage rates. However, many analysts believe national home prices will be the final housing metric to bottom out this cycle.

Invitation Homes has warned that the recent eviction moratorium extension in Los Angeles County could increase its bad debt this year.
The company expects unpaid rent to rise to 2% of gross revenue this year from 1.5% in 2021.
The rise in bad debt is mostly due to the regulatory environment in Southern California, and court backlogs in other areas are also contributing to the overall increase.
Despite the expected rise in bad debt, Invitation Homes' revenue and rent growth expectations for the new year remain strong.
Rising property taxes in Florida, Georgia and Southern California contributed to an increase in operating expenses, but the company expects these expenses to revert to more normal levels this year.

The Invisible House is designed to reflect and blend seamlessly into the rugged landscape, and is surrounded by Joshua Tree National Park.
Sustainability is a key aspect of the home's design, including eco-friendly features such as heat-reflecting Solarcool Glass exterior, foam roof, and solar panels.
The interior boasts a sleekly designed eat-in kitchen, spacious living room, resort-like master retreat with a soaking tub and rain shower, and a wall of sliding glass doors.
The property comes with a prefab guesthouse and has "one of the smallest footprints in Joshua Tree".