homes

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The 2023 housing market faced one of the same roadblocks we saw in 2022: mortgage rates were too high for home sales growth. Now that we’re in 2024, the Federal Reserve‘s rate hike cycle is over, so let’s look at what that means for housing demand and home prices. However, a yearly forecast has limitations and in this crazy housing and economic cycle, if people give you a yearly forecast without guidance as variables change, you’ll be dealing with stale data. Every Saturday I publish a weekly housing market tracker with forward-looking data and insights so you can adjust quickly to market conditions.

Here’s my forecast for 2024:

10-year yield and mortgage rates

For 2024, the 10-year yield range will be similar to 2023, but with a few different variables to watch.

  • 10-year yield range: 4.25%-3.21%
  • Mortgage rates: between 7.25%-5.75%

A key level to watch for the 10-year yield is 3.37%. To go below this level last year, labor would need to break, so I borrowed Gandalf the Grey’s catchphrase: “You shall not pass.” And the 10-year yield did not pass that level in 2023!

However, if the labor or economic data gets weaker, we can break through that Gandalf line, which means 2.72% on the 10-year yield is in play for 2024. This could mean sub-5% mortgage rates if the spreads get better — a win for the housing market.. If the spreads are still bad, mortgage rates will be between 5%-6%. If the 10-year yield gets above 4.25%, the U.S. economy has outperformed again, as it did in Q3 when it grew at 5% and jobless claims fell.

Here is a chart of the 10-year yield with the inflation growth rate data tied to it for 2023:

Now let’s talk about mortgage rates!

The spread between the 10-year yield and mortgage rates can get better in 2024, which means mortgage rates could be 0.625% to 1% lower next year. For example, mortgage rates would be under 6% today if the spreads were normal. Instead, they closed 2023 at 6.67%. If the spreads get anywhere back to normal and the 10-year yield gets to the lower end of the range in 2024, we can have sub-5 % mortgage rates in 2024.

With the Fed no longer in hiking mode, any economic weakness on the labor side is a better backdrop to send mortgage rates lower. Unlike 2023, this year there are more positive variables that could send mortgage rates lower rather than higher.

Home prices

If everything stays constant, 2024 home-price growth levels will repeat what happened in 2023: low single-digit national home-price gains.

What could make home prices grow faster than low single digits? If I am wrong and mortgage rates go lower for longer and we don’t get more new listings in 2024, then home prices can grow faster in 2024 because we will have the same issue as before: too many people chasing too few homes.

What could make home prices decline? This would happen if we saw a surge of stressed inventory and mortgage rates didn’t go low enough to handle that much new supply into the market. We had mortgage rates in a solid range between 3.75% and 4.75% for most of the previous decade, but that hasn’t been the case recently. So, this is something to consider only if we see an increase in stressed inventory. 

To give an example of what I am talking about, from 2008 to 2011, new listings data ran between 250,000 and 400,000 each week, with the peak seasonal data at 370,000 and 400,000. We haven’t had new listings data break over 90,000 in the peak seasons of 2021, 2022 or 2023. So if we do see a push in stressed new listings we have to be on it right away and see how the supply and demand equilibrium works.

However, we won’t have this conversation until we see it in the weekly data. In this episode of the HousingWire Daily podcast I explain how fast the housing dynamics shifted after Nov. 9, 2022, with prices returning to all-time highs in months. This is why weekly data is important!

Existing home sales

When we saw mortgage rates fall from 7.375% to 5.99% early in 2023, we got one of the most significant existing home sales prints ever, going from 4 million to 4.55 million. We need lower rates to get more consistent sales growth and to have one or two monthly existing home sales prints of 4.72 million or more, it’s going to take sub-6% mortgage rates with duration.

We will track the purchase application data weekly, however, I am only focused on that 4.72 million monthly print number for 2024 because the lack of affordability with rates still this high is impacting sales.

New home sales

As long as mortgage rates go lower, the builders can sell homes because they can lower mortgage rates even more than the existing home sales market and they have a pipeline of homes to sell. They have 106,000 homes that they haven’t even started construction on yet, and only 78,000 new homes have been completed and are ready to sell. They will manage their supply slowly.

Economic outlook

Looking at the economic cycle and the housing economy, we have a similar playbook going into 2024 as we did in 2023. Let’s look at that dynamic.

I raised the final flag in my six recession red flag model on Aug. 5, 2022. However, by Nov. 9, 2022, I saw that housing market dynamics had shifted and if I was right, the builders were about to get more positive about their business. Sure enough, the builders confidence survey started to grow again going into 2023.

As mortgage rates started rising toward 8%, the builders survey started to go lower, mostly due to smaller builders feeling the pinch. Now that rates have fallen again, this is a positive for the single-family housing market. The new home sales market means more to the economy because of construction jobs and big-ticket item purchases. In contrast, the existing home sales market is more about the transfer of commission and moving trucks.

People correctly keep an eye on the builder’s survey. However, the builder survey and new home sales rebounded to growth in 2023, and now, with rates almost down 1.5% for 2024, lower rates will help the builder survey again. 

This is only for the single-family housing market, not the apartment market, which is heading into a decline in activity. This is something to watch on labor, as certain builders will not need as many people to build apartments. When rates stay too high for too long, you eventually impact future production.

We will only start talking about a recession when jobless claims break over 323,000 on the four-week moving average. We won’t talk about a recession today, or next year or even this decade until that happens. The history of economics has shown us that we need the labor market to break to have a job-loss recession. If you followed my work during COVID-19, you know my critical two takes about the labor market and how household balance sheets are much better now than ever. When jobless claims break that critical level, we will have a good discussion about the economy and the housing market, just not yet.

If the economy doesn’t have a credit event where lending gets tighter, the consumer should hold up in 2024, especially with lower mortgage rates. This means the homebuilders can sell more homes and keep construction workers employed longer. Falling construction employment is a staple of all job-loss recessions, and we have avoided that so far.

For 2024, I want to stress that the economic data can turn on a dime — both positive and negative — in ways that weren’t the case in the previous decade. Following the weekly tracker will be essential for the housing market and the economy. I track this stuff daily so you don’t have to!

The existing home sales market has spent the last 18 months with sales near great recession levels. Now it’s time for the Fed to give up on its covid-era housing economic policy and be pro-housing once again. It’s time to get U.S. housing off the COVID-19 policy and get sales growing.

Source: housingwire.com

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We’ve ridden the waves of 1970s revivals, wall-to-wall carpeting, the rise and fall of the Ultrafragola, and bouclé upholstery. When we type “interior design trends 2024” into our crystal balls (or indeed, into Google) what are we likely to find? AD PRO consulted the experts, and 2024 promises to be a year of thoughtfully chosen offbeat colors, a mix-and-match approach to the designs of different time periods, and a return to romanticism, with jewel tones and florals offering a flirty, old-fashioned respite from the onward march of technology.

Stone Fruit Chic: Peach and Apricot

Soft, sweet, and just a bit tart, peach and apricot are the dominant hues in the home trends color forecasts for 2024. Pantone declared Peach Fuzz its color of the year, and Leatrice Eiseman, executive director of the Pantone Color Institute describes it as “a color radiant with warmth and modern elegance.” Gemma Riberti, head of interiors at trend forecasting agency WGSN, notes that her team has had its eyes on orange. In particular, they note its emergence as “a recharging near-bright in the wellness sector” and as a vivacious alternative to traditional pastels. WGSN’s color of 2024, Apricot Crush, “can be easily paired with neutrals and naturals, and is suitable for textiles, glass, bath, and bedroom products” Riberti says, “but you can also work it to create intriguing narratives: offset it with greens, purples, and blues for vibrant contrast.”

A sweet-as-a-peach Ettore Mocchetti slipper chair takes up residence on the upper floor of a home designed by Ninety Nine Group in Forte dei Marmi, Italy.

Marco Bertolini

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The classic technique of selecting chromatic bedfellows from opposite sides of the color wheel is also in Champalimaud Design’s toolkit. Principal Courtney Brannan tells AD PRO that when it comes to interior design trends in 2024, “we are seeing all the possibilities of peach and turquoise tones.” Though these shades have a tropical feel to them, they “can also feel neutral,” she says. Case in point: “At the Ritz-Carlton, Grand Cayman, turquoise creates an amplifying, formal statement surrounding the Silver Palm Bar.” Meanwhile, in New York City’s West Village, an apartment’s peach plaster wall “has a much more understated presence, calmly backgrounding the artful living space around it.”

That’s So Metal

It’s back to the essential elements (literally) for home decor trends in 2024: chrome, steel, and aluminum are suddenly everywhere. Pinterest Predicts 2024 includes a “Hot Metals” board with a distinctly surrealist aesthetic—gleaming surfaces that resemble the shiny sinew of liquid mercury.

Mirrored surfaces and chrome furniture are on the upswing for 2024. Here, a mirrored dining table anchors a dining room in the home of AD100 designer Oliver M. Furth and his partner Sean Yashar.

Photo: Yoshihiro Makino/Styling: Amy Chin

David Michon, author of the Substack newsletter For Scale, thinks this is a natural consequence of the early-2020s overload of earth tones. “The desperate search for some kind of warmth in this cold world has exhausted ‘earthy’ browns and ‘meditative’ grays,” he notes. But don’t be too quick to write off these metallic finishes as industrial: “The many stainless-steel explorations of Milan’s Concorde, Harry Nuriev, or Tejumola Butler Adenuga show us that, in fact, steel simply reflects.” In general, says Michon, these metals amplify whatever vibe a room is already giving. With one notable exception: “stainless-steel appliances, which remain overrated.”

House of Hunt founder Holly Hunt concurs, but with a slightly more muted finish: “I foresee bright aluminums and silver gaining popularity in 2024 after years of gold and black dominating metal hardware and accessories,” she tells AD PRO. “However, I tend to avoid metals that are too shiny and prefer the richness of a brushed chrome or nickel, as they give a more polished and sophisticated look.” Adding to the evidence: Earlier this month, Nifembi Marcus Bello presented an eye-catching suite of cast-aluminum furniture at Design Miami.

Dark and Deep: Jewel Tones

The saturated hues of precious gems are giving the palette of 2024 design trends a sense of velvety mystery. According to Rob Natale, chief of design at Sixpenny, this is thanks in part to the recent dominance of neutrals across interiors. “People are rediscovering color in their homes, which is a welcome shift from the all-neutral palette we’ve seen for several years, and jewel tones are at the forefront of that shift,” he says. “It’s a perfect way to incorporate richness, whether as an accent or as the centerpiece for a space since they create such a strong counterpoint to almost any look.” (Heeding their own wisdom, Sixpenny is currently selling furnishings in an array of gem-inspired hues.)

Source: architecturaldigest.com

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A letter sent from U.S. Senate Banking Committee Chairman Christopher Dodd to Senate Majority Leader Harry Reid revealed details of a proposal to set up a government-sponsored entity to buy troubled mortgages.

“The new mortgages would be new 30-year fixed-rate mortgages, ensuring long-term stability for homeowners and the housing market,” Dodd said in the letter.

He explained that the government could buy the mortgages at a “steep discount” based on current market values, and then refinance them into government-backed loans.

“The discounts would then be passed on to homeowners in the form of new, lower-balance mortgages insured by (the Federal Housing Administration) or backed by the housing government-sponsored enterprises,” Dodd added.

Dodd projected an initial cost of $10 billion to $20 billion to fund the program, which would then be supported by its loan portfolio.

“The difference between the old mortgage and the new mortgage would be sufficient, after initial capitalization, to fund the program and cover possible losses,” Dodd wrote.

The idea, which Dodd said was not part of the temporary stimulus package, would be part of the long-term solution to tackle the current mortgage crisis.

Ideally, it would help homeowners stay in their homes without a total bailout, while protecting banks and mortgage lenders from massive losses tied to outright foreclosure.

It could also alleviate pressure currently piled on government financiers Fannie Mae and Freddie Mac.

The tricky bit of the plan will be determining which loans qualify as severely distressed, an issue complicating efforts extended by the Hope Now Alliance.

Dodd also mentioned that he wants to see an increase in the conforming loan limit as part of the economic stimulus package, along with a FHA loan reform bill.

Source: thetruthaboutmortgage.com

Apache is functioning normally

Mortgage interest rates continued their decline this week and have hit the lowest level in six months since May of 2023. Mortgage interest rates are now at an average of 6.61%, easing from 6.67% last week. The typical monthly mortgage payment for a $400,000 home is now at $2,046. While NAR’s Pending Home Sales shows flat data from October to November, the recent week’s rate decline should motivate buyers who had been priced out of the market.

There are many signs of encouragement heading into 2024 in the housing market, such as more housing inventory from home builders, lower mortgage interest rates, and demographics. This year, even the youngest baby boomer (born between 1946 and 1964) turned 60 years of age. Baby boomers are the largest share of home buyers and may be looking for their retirement property. Last year, half of older boomers paid all cash for their homes and are less concerned with mortgage interest rates. Additionally, millennials (the largest adult generation) may be looking for their first property or a move-up family home.  Housing demand is apparent. With added inventory and better mortgage interest rates, 2024 looks like a better year.

Source: nar.realtor

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The cost of living in Boston is one of the highest in the country at 50.8 percent above the national average.

Prices are a bit higher all around, but Boston costs less in general than major cities like New York City’s Manhattan or San Francisco. Other cities, like Seattle and Los Angeles, are more Boston’s equal when it comes to the overall cost of living.

Monthly costs really vary depending on where you live in Boston and what you love to do. If you need tickets to every Red Sox game, living expenses are going to go up. If you can’t resist the pull of the North End for dinner every Saturday night, your need a bigger budget.

Regardless of your indulgences, though, the cost of living in Boston is manageable if you understand what you’re getting into before you make the move. Check out how all the estimated monthly costs break down to see if this amazing but expensive city is right for you.

Boston housing prices

As is the case with other major metros across the U.S., the housing market — both for-sale and for-rent — is hot in Boston, with no signs of slowing down. Rentals are in demand, and with the huge influx of college students every fall, affordable units are hard to find.

Housing costs in Boston are 120.9 percent higher than the national average. That puts monthly rent up there with cities known for outrageous prices like San Francisco and New York City.

Although in Boston, rents only increased a little over last year. Still, the total price is high for both one-bed and two-bed units. An average one-bedroom apartment will cost you $3,922 per month, up 9 percent from last year. A two-bedroom comes in at $4,952 per month, up 5 percent over last year.

Of course, living further away from the city center helps bring prices down, but it’s still a challenge, especially as a single person, to find solid housing. You might have to settle for something a little small, or look for monthly rents slightly outside the city, but close to public transportation.

If you’re brave enough to try to buy in Boston, the median home price is $796,250, up 9.1 percent over last year. Homes stay on the market for about three weeks, which is not very long.

Boston cost by neighborhood

There are plenty of amazing neighborhoods to live in throughout Boston, and you can find one that works for you at almost any price point.

Of course, the most expensive neighborhoods are in the very heart of the city. They’ll give you a sweet address and put you in proximity to everything, but they’ll heavily impact your cost of living index. An average one-bedroom right in Downtown has a monthly cost of $4,463. Getting closer to Boston Common, Back Bay East is $4,383 for an average one-bed, an 83 percent price increase over last year.

Getting closer to the city’s average one-bed cost is Fenway-Kenmore and the South End.

Boston University and Northeastern University students flock to the cheaper neighborhoods once they move off campus for housing. They’re most interested in places like North Allston with one-beds at $2,175. They’ll even venture outside of the Boston metropolitan area to find a deal in places like Brighton.

Boston food prices

Boston has evolved into a foodie’s paradise over the last decade. In addition to its revered Irish pubs, lobster rolls and clam chowder, James Beard-award-winning chefs have opened esteemed eateries in just about every corner of the city specializing in a wide variety of cuisines.

Restaurant meals in Boston can vary, so there are affordable options for food. At an inexpensive restaurant, your average meal only costs $20, but if you’re on a date, a three-course meal for two rounds out to $83.

When it comes to groceries and home cooking, you can expect to spend slightly more as Boston’s food costs are 16 percent higher than the national average. That’s about the same as where prices stood last year.

How does this translate when you’re looking at food expenses? A steak is going to run you about $17.92. A half-gallon of milk and a box of cereal is $8.35. That six-pack of beer (preferably Sam Adams) rings out to about $10.99.

All of these are affordable items, but with a long grocery list, the money totals up fast. It’s why budgeting is so important to maintaining a solid quality of life.

Boston utility prices

Boston gives you all four seasons in the extremes. From red-hot summers to windy and snowy winters, you’ll definitely get some variety weather-wise.

This also means utilities are a big item on your list of expenses. Though many apartments you rent don’t come with central air, they all have heaters that you’ll run full blast through most of the winter. For AC, opt for a window unit, even though it will raise your electricity bill. In an average size apartment, you’ll need at least one per bedroom (a fan could work in the living area).

With all this, your utility cost in Boston is 23.5 percent above the national average. This is pretty on par with most New England cities. Your energy bill each month will cost you around $250.47.

Boston transportation prices

One of the great things about living in Boston is you don’t need a car. Public transit via the Massachusetts Bay Transportation Authority (a.k.a. the MBTA or The T) is so convenient. It also makes transportation expenses really a combination of traveling on The T and car care, if you decide to own one. Overall, transportation costs are 21.1 percent above the national average.

Being a driver in Boston does come with a hefty expense. Most apartments don’t have parking spaces as part of the rent, so you have to pay extra. Parking is almost always paid either in a garage or via meters, and any free spots fill up quickly and are hard to find.

Renting a monthly parking spot in Boston will cost you around $300 on average, and metered parking ranges from $2 to $3.75 per hour.

However, once you park in the city, it’s easy to cut back on transportation costs thanks to a highly walkable layout in this eastern Massachusetts town. All in all, Boston ranks high in terms of walking (an 89 walk score,) and is pretty friendly for bike riders (77 bike score), as well.

The Massachusetts Bay Transportation Authority

Bostonians may not love the MBTA, but they sure take advantage of The T when living in or near the city. This intricate subway system goes everywhere thanks to the Blue, Red, Green and Orange lines. There are also buses and the Silver Line to get locals everywhere a train doesn’t already go.

A one-way subway ride is $2.40, and bus fares are $1.70 per way. Using a CharlieTicket is the easiest way to ride, and this pass gives you access to commuter rail trips and ferry rides, as well.

Boston healthcare prices

Although it’s difficult to nail down specific healthcare costs because individuals have their own healthcare needs, the healthcare system in Boston is top tier.

The overall cost of healthcare in the city is 17 percent higher than the national average, a 2.5 percent dip over last year. This is less than in other large cities like Chicago, San Francisco and Seattle.

Even with this piece of your cost of living on the high side, individual medical visits aren’t too bad, even without insurance.

  • Doctor’s visits are around $182.50
  • Eye doctor visits are around $115.88
  • Dentist visits are around $131.50

And, with good insurance coverage, these prices go down even more, allowing a person to afford the care they need to stay healthy.

Boston goods and services prices

When it comes to quality of life, goods and services are a huge piece. This is everything in your budget each month you want to do but could live without if it became necessary.

Overall, goods and services are 19.9 percent above the national average. This means entertainment costs are usually higher for all the fun things you do out in the city like waiting to grab a pizza ($12.99) in the North End or going to see a movie ($14.96) off Boston Common.

Even with Boston’s higher prices, there are plenty of things to do in the city for free. Wander through the Public Garden or walk the Freedom Trail. It doesn’t cost anything to take in the history of this amazing place.

Taxes in Boston

Massachusetts has a state-wide sales tax only. Individual cities cannot add on to it. This means you’ll pay 6.25 percent on things you buy everywhere in the state. It also means that when you wrack up a $1,000 bill shopping on Newbury Street or around Quincy Market at Faneuil Hall, $62.50 goes straight to taxes.

To make Boston life a little easier, the state offers an annual sales tax holiday, usually in August. This is a tax-exempt weekend for retail items and a big shopping weekend for many.

How much do I need to earn to live in Boston?

Taking it from the experts, 30 percent of your salary should go toward rent. But, when talking about the cost of living in Boston, that number gets pretty high. Taking the average one-bedroom rent as the base ($3,863), you’d need to have an average salary of $154,520.

Even with a solid job market, the median household income is only $76,298. Most likely, your average salary is not going to make it possible to live alone in the heart of the city. But, you’ve got options. To get specific, use our rent calculator to compare your current budget and savings with the cost of living averages.

Living in Boston

Living in Boston certainly comes with the expectation you’ll shell out a lot of money to settle in. But, this is a place so worth considering. There are passionate people, a booming business climate, countless cultural institutions and world-class colleges and universities.

This information and more are things that every Bostonian knows. It’s what you’ll discover if you can make the cost of living in Boston work within your budget.

The Cost of Living Index comes from coli.org.
The rent information included in this summary is based on a calculation of multifamily rental property inventory on Rent. as of August 2022.
Rent prices are for illustrative purposes only. This information does not constitute a pricing guarantee or financial advice related to the rental market.

Source: rent.com

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2023 has seen some wonderful decorative trends. With the evolution of the ‘Minimaluxe’ movement came a wave of beautiful decorative pieces; in the world of decorative lighting, we’ve seen a renaissance, and we’ve embraced a whole new range of textures and materials. It’s been a great year for decor, so it’s no wonder the interior designers have been doing some serious shopping.

We’ve all got a favorite home purchase of 2023 (mine is my pair of wall sconces that sit above my bed), but the tastemakers’ purchases are really telling of what interior design trends have made an impact and what is here to stay. To find out, I caught up with three of my favorite designers to find out their favorite buys of 2023.

1. Fireplace accessories

(Image credit: DuRietz Design)

If there is one major takeaway from 2023, it’s that we want our homes to be cozier than ever before. A key pillar for coziness is warmth and lighting, both of which are covered by open fires or log fires. Fireplaces have experienced a renaissance, and homeowners are enjoying the opportunity to decorate mantelpieces and purchase fireplace accessories that reinforce the cozy living room aesthetic. 

Christoffer Du Rietz of Du Rietz Design. 

‘Our new open fireplace was made in a Calacata marble we had saved for five years back and designed with some nice details to match the house. It came just in time for fireplace season. Apart from looking great, it helps a lot when lighting the fire, which is many times a week on cold winter days.’

Jumbo Wicker Log Basket

Log Holder

Wrought Iron Fireplace and Hearth Tool Set

bedroom if you want to restyle a nightstand, or perhaps on a bookshelf that needs a bit of decorative attention, they’re fantastically helpful for an uncluttered home.

For Melissa Warner Rothblum of Massucco Warner, this sculptured marble vanity box by west elm made a beautiful impact on her living room shelf. ‘I think this little box is so chic and is a lot of bang for the buck,’ she says. ‘It’s also perfect for tucking away keys on an entryway, remote controls, bedroom trinkets, or garage clickers.’

Chelsea Cement Box

Marble Vanity Box

Large Marble Box

Kitchen accessories have taken off in 2023. No longer are our kitchens spaces for purely functional items. Instead, we’re enjoying items that bring a cozy feel to the space. Forget all those branded mugs you’ve somehow accumulated over the years – it’s out with the old and in with the new. We’re coveting a curated collection of kitchen items that fit with the wider aesthetic of the room – be it a stylish chopping board displayed artfully on a backsplash shelf, or an open shelf of beautiful coffee cups.

Stoneware coffee cups that have that handpainted feel have proved popular, used as decor as well as for a functional kitchen necessity, while interior designer Corinne Mathern takes pride in the pair of glass espresso cups she has in her kitchen. ‘One of the best things I bought for under $50 this year was two vintage Art Deco glass espresso cups on a trip to Italy this year. They make my early morning coffee time with my husband really special and they’re so beautiful,’ she says.

Espresso Double Walled Cup

Cast Black Espresso Cup

Material: Stoneware
Price: $11.20

Source: livingetc.com

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Mortgage rates declined significantly over the past week, marking the eighth straight week of falling interest rates. 

The 30-year fixed mortgage rate is 6.61% for the week ending December 28, 2023, according to data from Freddie Mac. This represents a decrease of -0.06% from a week ago.

The 15-year fixed rate mortgage stands at 5.93%. That’s 0.02% lower than a week prior. At that rate, you’ll pay $840 per month in principal and interest for every $100,000 you borrow. 

The rate you’ll actually receive will vary based on the price of the home you’re buying, your credit history, and the size of the down payment you’re making. You can compare the offers below to find your best rate.

High interest rates are sticking around as central banks around the world, including the Fed, battle stubbornly high inflation with a series of aggressive interest rate hikes. These efforts to rein in prices have also slowed global economic growth and fueled recession fears. 

Geopolitical tensions stemming from the ongoing war in Ukraine and conflict in the Middle East have further clouded the economic outlook. 

As the Fed asserts that more rate hikes are likely needed to tame inflation, analysts expect mortgage rates will continue trending upward in the near term. This could place even more affordability pressure on the housing market, especially impacting first-time homebuyers.

Why shop around for mortgage rates?

Getting the lowest mortgage rate possible can save you tens of thousands of dollars over the lifetime of your home loan. With rates on the rise in 2023, it’s more important than ever to understand the factors impacting mortgage rates, strategically shop for the best deal, and meet lenders’ requirements to qualify for the lowest rate. 

This guide will cover everything you need to know about today’s mortgage rates, from how they’re determined to where experts expect them to go in the months ahead.

What impacts mortgage rates

Mortgage rates tend to follow the direction of long-term government bond yields, especially the yield on 10-year Treasury notes. Here are some of the key factors that can influence fluctuations in these yields and mortgage rates:

  • Federal Reserve policy: When the Fed raises its benchmark federal funds rate, it often leads to higher borrowing costs across the economy, including mortgage rates. The Fed began aggressively hiking rates in 2022 to combat high inflation, causing mortgage rates to soar. Further Fed rate hikes are expected through 2023.
  • Economic growth and inflation: Strong economic growth and rising inflation generally lead to higher mortgage rates, while slower growth and disinflation place downward pressure on rates.
  • Geopolitical events: Global conflict or political turmoil often spur investors to move money into safe haven assets like Treasury bonds, lowering yields and mortgage rates. 
  • Investor demand: Strong demand for mortgage-backed securities from investors leads to lower mortgage rates. When demand falls, rates tend to rise.
  • Employment trends: A strong job market can fuel economic growth and push rates higher. Conversely, weak hiring data or increased unemployment tend to cause lower yields and rates.
  • Housing market trends: When housing demand is high, rates tend to rise as lenders face increased demand for mortgages. But lower demand for homes often correlates with declining mortgage rates.

Tips for finding the lowest mortgage rate

When shopping for a home loan, following these tips can help ensure you lock in the lowest possible mortgage rate:

  • Check rates from multiple lenders: Rates vary by lender, so comparing quotes from several lenders ensures you don’t overpay. Online rate comparison sites can give you a quick overview of prevailing rates.
  • Improve your credit score: Work on raising your credit score to at least 740, which will qualify you for the best mortgage terms. Pay down debts, correct any errors on your credit reports, and avoid taking on new debt before applying for a mortgage.
  • Lower your debt-to-income ratio: Lenders look closely at your existing debts in relation to your income. Paying down credit cards and other debts before applying for a mortgage can help lower your DTI and qualify for better rates.
  • Make a sizable down payment: Down payments of 20% or more of the home’s purchase price result in the best mortgage rates and eliminate the need to pay private mortgage insurance.
  • Compare quotes for 15-year and 30-year terms: In general, 15-year mortgage rates are lower than those on 30-year mortgages. But the higher monthly payment on a 15-year loan may not fit your budget.
  • Lock in your rate: Rates fluctuate daily. Once you find the rate you want, lock it in by completing most of the mortgage application paperwork. This protects you if rates rise further before closing.

Minimum requirements for common mortgage types

Mortgage lenders weigh many factors when reviewing applications, but most have basic requirements borrowers must meet to qualify for certain loans. Here are typical minimum standards for popular mortgage types.

Mortgage rates over the past three years

Mortgage rates have seen significant fluctuations over the past few years:

  • 2020: Historic lows due to the COVID-19 pandemic. The average 30-year fixed rate mortgage fell below 3% by the end of 2020. 
  • 2021: Rates remained very low early in 2021, then began to rise in the spring. By December 2021, rates returned to pre-pandemic levels around 3.5%.
  • 2022: The Fed’s rate hikes and inflation drove mortgage rates dramatically higher throughout 2022. Rates soared above 7% in late 2022 from around 3% at the beginning of the year.
  • 2023: Rates are projected to remain elevated in 2023 compared to the past decade. Further Fed rate hikes could push averages above 8%.

The chart below shows average rates for the 30-year and 15-year fixed rate mortgages over the past three years.

The takeaway is that mortgage rates shift constantly in response to economic or political factors. Staying informed and timing your purchase to lock in a lower rate can make a huge difference in how much home you can afford. Casting a wide net when shopping for lenders pretty much guarantees you’ll secure the most competitive rate on your loan.

Methodology

Mortgage rate data comes from Freddie Mac, a government-sponsored leader in the housing industry that tracks average mortgage rates. We considered average rates for both the 30-year fixed rate mortgage and 15-year fixed rate mortgage. Freddie Mac rates exclude additional fees and points. 

Average rates are reported weekly on Thursdays and updated accordingly.

This article is not intended to be financial advice. Before making significant financial decisions, you can review your options with a financial advisor or credit counselor.

Source: qz.com

Apache is functioning normally

When you apply for a new job, you know that you’ll need to submit a cover letter and resume. It’s the best way to show your past work experience and qualifications. But did you know that you can also create a renter resume and rental cover letter as you hunt for a new place to rent?

That’s right! A renter resume is a great way to highlight your past rental history, detail your income and occupation and help the landlord get to know you better. Renter resumes help you stand out from lots of applicants. They also show your future landlord just how serious you are about wanting to rent a home from them.

When you find yourself looking to rent a new home and you want to better your odds of securing that lease, check out this sample letter to rent a house and draft up your own renter resume.

When to create a renter resume

Once you’ve decided that it’s time to move and find a new place to live, you’ll start the house hunt to find some new locations to rent. When you go to rent a new place, you’ll have to fill out a rental application, which is standard practice.

While a renter resume isn’t required, it’s a nice added touch to help the landlord know you better. Here are a few scenarios when you should create a renter resume:

It’s a competitive market

Just like dream jobs, your dream apartment may go up on the market and quickly get snatched up. A renter resume is a great way to stand out from other potential tenants in a hot market.

Your rental or job history is spotty

Landlords look at your past job and rental history to predict what kind of tenant to expect. Property managers want to rent to people who have a consistent income, will pay the rent on time and will become a good edition to the neighborhood and other tenants.

If your history has gaps, a renter resume is a great way to explain the circumstances surrounding it. This is your chance to vouch for yourself, explain your history and convince the landlord that you’re a worthy candidate for the rental.

You don’t have a rental history yet

In some cases, people like students or newlyweds who have never rented before will lack rental history. In these situations, you won’t have a rental history to highlight and show that you would make an excellent tenant.

Use a renter resume to explain who you are and why you’d be a great tenant.

What to include in your renter resume

If you think a renter resume is a good option for you, here are the details you must include:

  • Contact information: Include your contact information like your email and phone number so the landlord can easily reach you
  • Objective: Include two to three sentences that clearly state what you’re hoping to achieve and why it’s important to you. Make this a short and concise paragraph that outlines why you want to rent a new home.
  • Background and personal information: Include details like hobbies, interests or how you spend your free time. While you don’t have to include details like race, gender, religion, familial status or age — absolutely include things that’ll humanize your application and show your personality.
  • Rental history: Talk about where you last lived, why you’re moving and what you’re hoping to get out of the new location. This is your opportunity to talk about what kind of neighbor you are and how you’ll be as a future tenant.
  • Work or student history: Another important thing to include in your renter resume is your work or student history. If you’re currently employed, you can provide information about your job status. This shows you’re a steadily employed person who will pay rent on time. If you’re a student, showcase your dedication to education. Talk about how those qualities will apply to you as a tenant, too. Landlords want to rent to dependable, stable people so use your work history and ethic clear.
  • References: While you can put lots of good things about yourself on paper, a personal reference is incredibly important to see what other people say about you. When you include references, avoid listing family members. Instead, put people like your manager, past neighbors or mentors. If your landlord calls them and asks about you, these people will advocate for you.

Renter resume template

We’ve included a renter resume template to use as a sample letter to rent a house. Simply fill in the blanks with your personal information. You can also download the word document template here.

Your name
Email address
Phone number
Current address

OBJECTIVE: Write two to three sentences explaining your goals and motivations for wanting to move to this location.

(Example: I am interested in renting this home from you as I’m looking for a home in a location that is closer to work, has more space and is located in a neighborhood where I can walk and enjoy my neighbor’s company. This location seems like the perfect fit as it meets my needs and would be a great place to settle down long-term.)

BACKGROUND AND PERSONAL INFORMATION: Write two to three sentences about who you are, what you like to do and why you’re a good tenant.

(Example: I was born and raised in Salt Lake City and am now looking for a home of my own to rent. I went to school at the University of Utah and graduated with a degree in marketing. My husband and I are looking for a home where we can raise our two children. We like to go on walks, visit new parks, picnic as a family and explore new places. The location of this home is perfect for us as it’s close to work and good schools. We are a friendly, outgoing family who is eager to rent in a safe, clean neighborhood full of good people.)

RENTAL HISTORY: Include three to four sentences about where you’ve previously lived and why you’re moving. This section is very important because it’ll indicate what type of renter you are.

(Example: Before looking for a new place to live, I rented an apartment and resided there for X years. The reason I’m looking to move is that I want a place with more space and a backyard. I always paid the rent on time, kept the place clean and orderly and was a courteous neighbor at my previous location.)

WORK HISTORY: Draft three to four sentences detailing your work history, proof of income and employment record.

(Example: I’ve worked at the same company for five years. I’m dedicated to my work and company, which shows stability. I’m a hardworking person who values my job, hard work and a good work-life balance. When switch jobs, I make sure my finances are in order beforehand and have other work options lined up so I can stay consistent with an income.)

REFERENCES: Include a list of two to three references, your relationship to them, their phone numbers, email numbers and the best time to contact them. Make sure you let the references know that you’ve listed them so they are not caught off guard if the landlord reaches out to them.

Use your renter resume to impress future landlords

Once you’ve found the perfect place to rent, it’s time to write the perfect sample letter to rent a house. A one-page renter resume lets you stand out from other applicants and delight your future landlord.

Take a little extra time to write a renter resume using our template. You’ll find yourself moving into your dream home in no time.

Sage Singleton is a freelance writer with a passion for literature and words. She enjoys writing articles that will inspire, educate and influence readers. She loves that words have the power to create change and make a positive impact in the world. Some of her work has been featured on LendingTree, Venture Beat, Architectural Digest, Porch.com and Homes.com. In her free time, she loves traveling, reading and learning French.

Source: rent.com