My New Blog

Ok so the mortgage rate predictions were 100% wrong the week ending Sept 28th 2023 for 30 year fixed rate loans by many real estate reporters as to rates not rising further. The rate rose to the highest level since 2000 landing at an average of 7.31 % according to Freddie Mac. 

I could have told you that rates would still rise, but no one asked me. Lenders typically raise mortgage lending rates all the way through the holiday season and a probably will the first 2 weeks of January 2024.

Because it is a Presidential Election Year, politicians want to beat their chests saying how wonderful it is as they take credit for normal market conditions in a Presidential Election year.

The mortgage lenders who take off early during the holiday season for Tahiti and Bora Bora will be having huge drunken parties on the beach until after New Years Day over the profits made from mortgage lending in 2023.

After January and February of 2024 Mortgage Interest Rates will fall and there will be a Refinance Boom. Once the lenders decide that there needs to be more new loans in the pipeline is when the rates will drop.

If there is a shortage of homes for sale as is the case during 2023 then lenders will not be making many purchase mortgage loans. The only solution to increase the mortgage lending market is to drop rates and have two real estate markets side by side. One market will be Refinance Mortgages and the other will be Purchase Mortgages due to the lowering of mortgage rates to tap into Home Equity Mortgages.

As long as the Market is allowed to correct itself in 2024 and no more insane money is spent by clueless government types on Climate Change, Barking Spiders and Red Legged Frog Research, the natural law to me indicates lenders will want to take advantage of home equity refinance loans due to and over supply of homes with equity.

The present interest rates in 2023 are too high claim many who have not seen multiple real estate markets since 1970 to the present. Oh, Cry me a river. I bought my first house when i was 20 years old in 1974 and the interest rate FHA was 22.5 percent. Look it up. I made two payments each month. One payment was principal and interest and the other payment was principal only written on my mortgage check. 

A 20 or 30 Year Variable interest rate loan that is fixed for 7 years is what i have chosen for years as long as there is enough equity in your home. Why would I even  consider a fixed rate home loan which is going to cost more money.

So that is my forecast for 2024. The same real estate mortgage loan activity took place in 2020 during a Presidential Election Year. Its not Rocket Science but that is the way i see the future. 

Fifty Appraisers, both residential and commercial appraisers in my local area said I was nuts during Covid when I told them to go buy a new computer and a printer to write appraisal reports. The market was on Steroids and crazy busy for real estate professionals.

All they saw and said was Doom and Gloom while I clearly saw the lenders perspective already offering cash bonuses to mortgage loan originators to join a mortgage firm in November and December prior to the refinance boom. Later I was invited to a Zoom meeting of 50 real estate professionals to explain how I knew the forecast so clearly.

Should some other attempt at a Pandemic or attack at the Financial Business Sector then all bets are off. But i dont think thats the case. Its just business as usual and the mortgage rates go up and down based on market conditions and Presidential Election Years.









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