Most bankers are predicting at LEAST another 150 point rise in Fed Funds Rate over the next few months
That could take mortgage rates to 7% or higher.
The average monthly payment on an average home mortgage now is already 70% higher than a year ago.
Imagine if it is double, or more?
Of course housing will crash.
“Of course housing will crash.”
As it should. Normal economies do not have constantly soaring housing prices while wages remain stagnant for four decades.
Mortgage rates are more influenced by 10 year bonds than the short term rates, which are impacted by the FFR. I don’t think its likely mortgage rates go up much further unless people begin to think the Fed needs to take rates up 6-7% for several years. Keep an eye on the 10 year US Treasury rate, which is what the mortgage rates typically are indexed to
Probably also worth noting the current rates for mortgages already reflect the market expectation of a 4% FFR - which you can already see in the 1 year US treasury yield of 3.99% right now. For rates to go higher, the next 2 increases won’t cause it - they’ll have to believe the Fed will go even higher and for longer.
The only thing worse ( evil ) than high inflation is purposely crashing the economy to “fix” it.