• calendar_month March 15, 2023

The collapse of Silicon Valley Bank and Signature Bank over the weekend has sent shockwaves through the financial markets, causing a significant drop in mortgage rates. As a result, the housing market is facing an unexpected opportunity for price-strained homebuyers and homeowners to lock in a lower rate.

This drop in rates could offer an opportunity for price-strained homebuyers and homeowners who have been waiting for an opportunity to lock in a lower rate. A nearly half-point drop in rates could give a buyer at least 5% of their purchasing power back.

However, there is still a lot of uncertainty, and housing experts remain uncertain how long the dip will last. Further drops could spark some activity, but if the decline is short-lived, it is unlikely to move the housing market much.

 Before the collapse of Silicon Valley Bank, the Federal Reserve was likely to raise its benchmark rate next week after a stronger-than-expected jobs report on Friday. But the banks' failures and subsequent panic in the markets that triggered the drop in mortgage rates have left both housing economists and industry experts at a divide on how long the decline will go on.

This week's inflation data and next week's Fed meeting will have implications for the economy and mortgage rates, and by then, we should have a better handle on how much of a shock to the financial system this bank's failure will be.

As always, if you have any questions or concerns about the housing market, please don't hesitate to reach out to me.

Respectfully,