The U.S. avoided a recession in 2023, and some say it will have a soft landing in 2024. Inflation has hovered in the 3% range for many months higher than the central bank would prefer, but at 2.6% for personal consumption expenditures (PCE), it’s closer to the target range of 2% and far from the double-digit highs since the pandemic began. Most sources cite the core PCE, which excludes volatile energy and food prices which sat at 3.2% by year’s end - the lowest level since March 2021. Sales in March of newly-built homes posted their biggest monthly increase in 15 months, up almost 9%, pushing sales more than 8% ahead for the year. The median price fell almost 2% versus a year ago to a median of $387,600. Mortgage interest rates have crept up and could be dampening demand. As of today, May 1, 2024 - 30 year conventional rates are just under 8% at 7.933%, 30 year VA is 7.13% and 30 year FHA is 7.137. Existing housing inventory remains tight with approximately 3.5-month’s suppl
When you put 20% down on a home using a mortgage loan, you own 20% and the lender owns 80%. As you make payments, most of the money goes to pay interest while some goes toward reducing your principal. Meanwhile, favorable market conditions may be increasing the market value of your home, giving you instant equity. Equity is the amount of the home that you own, much like a savings account that pays interest on money you want to keep growing. After a few years, you may want to tap into that money to carry out home improvements, make a down payment on a second property, or pay off credit cards and other bills. Is it a good idea to use your equity? The answer is this: you’re putting your home in deeper debt, so your reasons for using equity instead of another means of borrowing or consolidating must be worth the risk. Home improvements are designed to add value to your home, a sure thing that will net you more money when you decide to sell it one day. Making a down payment on another ho