WASHINGTON, D.C. (WKBN) — There is a forum happening Thursday in Washington, D.C. to talk about the nation’s housing market and the implications for homebuyers and the impact on the economy.
The National Association of Realtors is hosting the forum that will include government leaders and industry experts.
The focus of the forum is The Current Housing Markers: Implications for Homebuyers and the Economy.
The annual policy forum begins at 11 a.m.
The group will examine the impact of home price growth and mortgage rates on the affordability of all homebuyers, and what that is doing to the economy.
Rising home prices typically lead to a robust economy, sparking additional construction. Federal Reserve decisions also play a significant role in setting the cost of financing. A mortgage is typically 70% of all household debt.
When the Federal Reserve decides to increase the federal funds rate, it puts upward
pressure on mortgage interest rates as well. Higher mortgage interest rates increase the overall cost of purchasing a home by increasing mortgage payments.
During the 2007-2009 recession and the COVID-19 pandemic, the Federal Reserve purposely tried to decrease mortgage interest rates more directly by purchasing mortgage-backed securities. Thirty-year mortgage rates temporarily dropped below 3% in 2020 but have since more than doubled.
The real estate industry is working with what is still considered low inventory and financing rates that have pushed many would-be buyers out of the market. Housing prices have begun to stabilize following historic heights during the pandemic and have dropped in most areas.
According to Redfin, the median home sales price in the U.S. is $383,001, a 1.4% year-over-year increase, compared to the 43% increase in 2020. The number of homes sold has decreased 33.5% with the average mortgage rate coming in at 6.3%.