Real Estate Industry News – February 2024

At the end of 2023, there were glimmers rate hope. Meaning, there was discussion of rates going down in 2024. One month into 2024, that does not seem likely.

  • Rates are still up. 
  • Inflation is still at an all-time high.
  • Inventory is on the rise, yet under 4 months.
  • Prices have stayed flat.
  • #1 home ownership roadblock, continues to be affordability.

Inflation is a KEY economic metric that the Federal Reserve monitors as it plans to cut, or raise interest rates. Another measure is consumer prices. Which were up 3.4% in December from a year earlier, up from 3.1% in November, according to data released by the Bureau of Labor Statistics on Thursday. It is the highest level recorded since September’s 3.7% reading.

“Mortgage rates have not moved materially over the last three weeks and remain in the mid-six percent range, which has marginally increased homebuyer demand,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “Even this slight uptick in demand, combined with inventory that remains tight, continues to cause prices to rise faster than incomes, meaning affordability remains a major headwind for buyers. Potential homebuyers should look closely at existing state and local resources, such as down payment assistance programs, which can considerably help defray closing costs.”

So, the BIG QUESTION, when, if at all, will the Fed start to cut rates?

According to Housingwire, forecasters expected the Federal Reserve to begin cutting rates in March. However, given December’s strong jobs report and today’s inflation reading, it’s becoming more likely that those rate cuts will come later in the year, Lisa Sturtevant, chief economist at Bright MLS, said in a statement.

So, like I said last month, DO NOT hold your breath for rates to go down. There are many economic factors in place that need to see a shift before rates do.

What will need to happen to have rate cuts?

  • Watch the JOB MARKET for layoffs.
  • Consumer income must increase.
  • Consumer spending must decrease.
  • Surplus of housing inventory on the market.

And with ALL THESE FACTORS in place………

People will always have a reason to buy and sell real estate.

Death | Divorce | Duplication | Destination | DEBT.

And whatever you do, STAY LOCAL! Whatever you are buying or selling!

  • Start with me, your local title company with the largest footprint in Oregon AND…..
  • Talk to a local agent and a lender and find out what works for you.
  • And remember, if you’re paying rent, you’re paying someone else’s mortgage, which I am sure they greatly appreciate… and consider.

Thank you for joining another edition of Piatt News | Your local Real Estate Source


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