Comprehensive Overview of Daily National Mortgage, Real Estate, and Business News including mortgage rates, housing starts, unemployment, and interest rate forecast for Thursday January 8th 2025. As of Thursday, January 9, 2025, we will provide an overview of what has happened in the U.S. mortgage market or the real estate and business sectors. We will also share any updates concerning mortgage rates, housing starts, unemployment rates, and interest rate projections.

Mortgage Rates:

Current Trends:

• The average yield on 30-year fixed-rate mortgages has spiked to 6.93 percent, marking the fourth consecutive week of increase and hitting its highest since early July.
• This rise is closely associated with the climbing yields on 10-year Treasury bonds in the U.S., which were at 3.62% mid-September but reached a peak at 4.66% currently.
• Heightened mortgage rates and soaring home prices are increasing housing affordability pressures on potential buyers.

Housing Market

Housing Starts:

• The housing market saw a significant slowdown, as December recorded the most substantial season deceleration in almost two years.
• It took an average of 70 days for homes to sell in December, marking the slowest December period in five years.
• This trend can be mostly attributed to higher mortgage rates that discourage potential buyers from buying a home or selling their current ones.
• Also, housing inventory decreased by 8.6% in November, representing the biggest monthly decline since January 2023.

Homebuilder Sentiment:

• U.S. homebuilders’ shares have fallen due to concerns about protracted high interest rates and prospective policy changes under Trump’s administration, such as increased tariffs and mass deportations that could raise construction costs.
• Since November, the S&P500 Homebuilding Index declined by 17.3%, reaching its lowest level since July.

Employment Data

Unemployment Claims:

• The labor market has remained robust, with new jobless benefit applications falling to eight-month lows.
• Initial claims fell by 9,000 to a seasonally adjusted 211,000 for the week ending December 28.
• This indicates that layoffs are decreasing and that labor market strength is being maintained.

Interest Rate Forecast

Federal Reserve Policy:

• Financial markets are becoming more skeptical of Federal Reserve interest rate cuts in 2025.
• High inflation rates above the Fed’s 2% target and better-than-anticipated economic performance could mean the tight monetary policy can continue.
• Market sentiment shows a 15% probability of no change in rates this year, up from last month’s figure of 4%.

Economic Outlook

Growth Projections:

• The U.S. economy has shown resilience, with growth rates pegged at 2-3%.
• However, there is speculation over a possible slowdown as high interest rates affect sectors such as construction and mortgage applications.
• Yet, despite these concerns, consumer spending and investment have been largely stable.

Implications for Stakeholders

Homebuyers and Sellers:

• Elevated mortgage rates and home prices continue to challenge affordability, potentially deterring prospective buyers or influencing sellers’ decisions.
• Homeowners are advised to delay refinancing until the rates reduce, while others should focus on making home improvements that increase equity.

Investors and Businesses:

• The current economic landscape is characterized by high interest rates coupled with policy uncertainties that may impact investments, especially in the housing and construction sectors.
• Stakeholders must closely monitor policy developments and market trends to inform strategic planning.

The U.S. real estate and mortgage markets face complex terrain characterized by rising mortgage rates, cooling housing markets, robust employment figures, and an uncertain interest rate outlook. Under these constantly changing conditions, stakeholders are advised to be informed and cautious while making decisions.