Mortgage Update: July 13
Rates are coming down after yesterday’s Consumer Price Index results, which were slightly lower than expected.
The Consumer Price Index (CPI) numbers came out yesterday. Everybody anticipated them to come down, which they did. They even came down a little bit more than expected... very slightly, but still more than expected. This bodes well for mortgage interest rates and we'll explain why in this update.
Consumer Price Index numbers come in as "Overall CPI" numbers and "Core CPI" numbers. The difference between the two is that the "Food" and "Energy" data are factored out of the Core CPI numbers.
Yesterday's report showed the Overall CPI at 3%, which was expected to come in at 3.1% to 3.2%. It came in a little bit better (or lower) than expected. In March 2021, the Overall CPI was around 9%. Yesterday's 3% is three times lower from its high back in spring 2021. This shows us things are definitely improving and will continue to improve. The Core CPI was at 4.8%. Again, this data excludes food and energy. This is as low as the Core CPI has been since October 2021.
So, what does this mean for mortgage interest rates? Well, as inflation continues to decrease, which is happening every single month and is expected to continue that way, mortgage rates will come down. They have indeed lowered over the last few days, and they've come down in anticipation of these low CPI numbers. Because it was better than expected, we saw rates come down a little bit more yesterday, too. The market is starting to trend that way again today. Rates are in that upper-six range right now, which is still lower than its peak from October of last year.
No one can truly anticipate what's going to happen over the next month or two, but that's okay. We have to work with what is in front of us. Housing continues to be a great investment and a pathway toward building generational wealth. Please contact us to learn more and get pre-approved. We can put you in touch with one of our loan officers across Southeast Michigan and throughout the whole state of Michigan, too.
Please email mortgages@johnadamsmortgage.com.
Have a great day!