Ep. 625 – Housing Market Tipping Point?

The Kapital News
The Kapital News
Ep. 625 - Housing Market Tipping Point?

With interest rates moving higher, it has pushed the 30-year fixed mortgage rate to 4.67 percent. A level not seen since Q4 of 2018. Coming off of record lows only a year ago, the increase in rates now doubles the average monthly mortgage payment. This is now where the rubber meets the road and in all likelihood, the housing market will begin to cool off – the question is when does it start and to what degree. Despite the Federal Reserve’s balance sheet being slightly reduced from a week ago, it is prudent to recall that the size of their balance sheet has grown by 10x since the GFC! A significant portion of their holdings are in mortgage-backed securities (MBS). Currently, the Fed holds $2.7T in MBS on their balance sheet. These purchases, especially over the last two years have fueled the massive price gains in real estate. Another consequence of this bond-buying policy is that rent prices have also sky-rocketed and continue to do so in many parts of the country. So, the average American continues to get squeezed coming and going. Food prices are up. Utilities are up. Medical costs are up. Autos and transportation are up. And housing is up. This inflation will persist and will likely get worse before it gets better. Stay diversified, stay vigilant, and stay with The Kapital News. #Inflation #Stagflation #FoodPrices #Liberty #Protests #Revolutions #Commodities #Gold #Silver

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