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Mortgage and Real Estate News for Wednesday January 29th 2025
GCA Mortgage Forums NEWS Mortgage and Real Estate News for Wednesday, January 29th, 2025: Here’s an update of GCA Mortgage Forums Daily Mortgage and Real Estate News. Many Americans are perplexed when President Donald Trump is talking about the housing values being stabilized and we will not have a real estate crash like we did with the 2008 real estate and financial crisis. President Donald Trump also made a career-changing bold statement that mortgage rates will drop and should drop below 5.0%. Most Americans know that President Donald Trump says what he means and does not talk out of his rear end, but many Americans who are homebuyers, homeowners, and real estate investors are questioning how our 47th President of the United States can make such a bold statement, NOT JUST ONCE, BUT MANY TIMES OVER AND OVER since becoming and being sworn in as the 47th president.
Home prices are dropping, there is a hyper-surplus of inventory, homebuilders are offering historic discounts and incentives, and home affordability is within reach of new homebuyers and homeowners. Inflation is skyrocketing, and wages are not keeping pace with inflation. Many homeowners who purchased a house in 2023 and 2024 with rates in the high 6.0% were banking on the mortgage rates dropping below 5.0%, but the opposite happened. The Dow Jones Industrials are at an all-time high and not expected to make a market correction. The ten-year treasuries are at an all-time high and did not correct or go lower after the Feds cut rates the past two times. Actually, when the Federal Reserve Board lowered rates the last two times, the ten-year treasuries went higher, thus making the mortgage rates higher. Everything is defying odds. How are gold and silver prices per ounce, and what are they forecasted to be for 2025? Bitcoin shot up over $100,000, which does not make any sense and defies all logic.
Mortgage rates today are 7.11% on conventional loans for prime borrowers, but home prices went down substantially due to more inventory versus demand for homes. More inventory of homes versus demand diminishes the equity of people’s homes, thus throwing a major hurdle on rate and term refinance and more so in cash-out refinance due to the diminishing equity of people’s homes. Many, if not most, mortgage companies are operating in the red and are borrowing money for their operations, hoping the mortgage and real estate markets are going to change for the better. Many mortgage loan originators (both from direct lenders and mortgage broker companies) and real estate agents are leaving the business for other careers. What will the Federal Reserve Board announce today with rates? Rates are supposed to remain the same. Will President Donald Trump’s statement have any merits, or was that just political talk? Is another housing market crash waiting to happen? Is President Donald Trump’s statement on the Federal Reserve Board lowering rates going to happen? Are we going to see more mortgage loan originators and real estate agents leaving the mortgage and real estate industries? What is the housing market forecast for 2025? What are mortgage rates forecast for 2025? What is the Federal Reserve Board expected to announce today and forecast in 2025?
Why is President Donald Trump so confident about the mortgage and real estate markets? I really trust the content, especially GCA Mortgage Forums News, because GCA Mortgage Forums News is never biased and calls out discrepancies and does not favor any political parties. GCA Mortgage Forums News is always out to post and publish mortgage, business, housing, and real estate news that is the truth, the whole truth, and nothing but the truth. I would appreciate it if you could cover all aspects of the above top points and add any recent updates.
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9 Replies
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By January 29, 2025, the housing and financial markets in the US were running in complexity, and the systems were operating dynamically and influenced by a myriad of economic factors. The following is a summarized overview that addresses some of the issues:
Home Prices and Inventory:
- According to the data, S&P’s core logic noted that US home prices surged by 3.8% in November 2024 from 3.6% in October.
- Robust purchases in numerous firms in places like New York primarily boosted the seemingly noticeable surge.
- Despite this, the average prices of homes across America are still lower than historically acceptable norms.
- Additionally, the nation faces a staggering deficit of approximately 4.5 million homes and units for many buyers.
- This proves to be a greater challenge for buyers than mortgage rates.
Mortgage Rates:
- Mortgage rates have risen above seven percent, which has not been seen in the last few decades.
- As a result, potential buyers’ affordability has been strained even more.
- The heightened rates and a limited supply of homes have led to a sharp decrease of approximately four million dollars in transactions.
- This figure is significantly low compared to the typical five to six-million-dollar transactions during a normal market.
Federal Reserve Actions
Interest Rate Decisions By The Federal Reserve Board:
Currently, the Federal Reserve is Believed to Continue Buying Homes Until Interest Rates Return to Normal Levels:
- In reaction to the economic slowdown, the Federal Reserve has decided not to cut interest rates.
- They want to keep inflation under control but don’t want to cause a recession.
- Economists underline that the Fed should operate independently and base their actions on data.
Inflation vs. Wages:
- The Fed’s expected target of 2% inflation is higher than this, worsening incomes’ purchasing power.
- The gap further reduces a household’s ability to spend on housing and other economic goods, causing more profound economic apprehension.
- By striving to keep inflation under control, the Fed has made the current economy more pernicious, which, in economic theory, refers to stagnation.
Stock Market Trends:
- The Dow Jones Industrial Average has reached new heights, signaling enthusiasm from investors.
- However, the yield for the 10-year Treasury has increased, which usually means increased, more expensive borrowing for all types of loans, including mortgages.
- It is rather intriguing to note that the Federal Reserve cutting rates did not lower Treasury yields.
- It seems counter-intuitive that this has resulted in higher-than-expected yields pushing mortgage rates higher.
Bitcoin Price Prediction
Institutional adoption of Bitcoin is on the rise, along with the perception that Bitcoin is a good investment against inflation, which explains why Bitcoin’s price surged past $100,000.
Outlook on The Industry
Real Estate Experts:
- Multiple mortgage firms face financial difficulties due to the market challenges of high mortgage rates and low housing inventory.
- As a result, some mortgage brokers and real estate professionals are leaving the industry searching for more stable markets.
Upcoming Trends
Expectations for the Housing Market in 2025:
- Experts anticipate affordability will still be an issue by 2025, with mortgage rates expected to remain above 6%.
- Home prices are expected to increase at a slower rate while remaining positive.
- The continuing scarcity of housing is expected to sustain upward pressure on prices.
Federal Reserve Expectations
As the Federal Reserve monitors economic data, it is likely to keep interest rates unchanged for the immediate future. Changes to the rates will depend on how inflation, employment, and the overall economy evolve.
Statements from President Trump
- President Trump remains positive regarding the housing and mortgage market, believing in the country’s economy.
- On the other hand, the data at hand is quite worrying.
- This is because it shows a lack of affordability and a demand-supply gap.
- While the government may do something to boost the housing market, the effectiveness of such actions will depend on a range of conditions, like the political environment and international economic climate.
To summarize, a few factors appear to be positive for the economy, but the housing and mortgage markets pose deep troubling factors. As you can see, there is a lot of information, and care needs to be taken into the very real and complex economic situations.
Presidency Urges Federal Reserve to Make Drastic Change to Policies
The above daily national mortgage and real estate news update was from GCA Mortgage Forums News: Mortgage and Housing Updates
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Below is GCA Mortgage Forums News: Mortgage and Real Estate Updated for Wednesday, January 29th, 2025. It includes the following talking points:
- Current Mortgage Rates
- Home prices
- Inflation.
- The Federal Reserve Board
- What the Federal Reserve has done recently regarding interest rates
- Potential actions the Federal Reserve Board could take in the future.
Start with the Housing Markets:
- The housing market, mortgage rates, and general economic situation are multi-faceted.
Here is a summary addressing most of your important points and giving a background to viewers and members of GCA Mortgage Forums News:
Market Predictions and Trends
Forecasts for the year 2025
Housing Markets:
- The 2025 housing market will rely on the economy’s recovery, interest rates, and consumer confidence.
- Further price adjustments may occur, assuming that inventory levels are high and demands are low.
Mortgage Rates:
- Real estate predicts this rate might stabilize without dropping considerably due to Fed admin policies or current economic conditions.
Real Estate Professionals:
- The mortgage and real estate industries can expect further attrition as other professionals seek more stable job opportunities.
Commodities and Cryptocurrencies
Gold and Silver Prices:
- The prices of gold and silver are tied to the current status of quote inflation and economic uncertainty.
- The global economy and trending inflation will greatly affect the 2025 estimates.
Bitcoin Surge:
- Speculative interest explains the rise in bitcoin prices to over $100,000, especially with how traditional valuation metrics ignore market fundamentals.
- This bitcoin price increase adds to the debate on cryptocurrency’s position in the global financial system.
President Trump’s Statements
Political Context:
- Trump may be overly optimistic in the first instance.
- This is because he thinks the housing market is politically incentivized or believes the statement the market will be able to adjust.
- Their statements surrounding rate reduction do not fit the current Fed situation.
The Merits of Statements:
- Even though he was quite daring, the essence of his statement was hardly substantiated by the facts, notably due to rising mortgage rates and added pressures on the housing market.
Chance of A Market Collapse
The Risks Ahead:
- This housing market could crash should the economy continue to worsen, jobs continue to decrease, or inflation goes unchecked, leading to an increase in unaffordability and subsequent foreclosures.
- The correlation between economic indicators, policies and regulations from the Federal Reserve, and current and upcoming market expectations that drive the housing market and mortgage rates.
As these conditions shift, great care should be exerted, emphasizing the need for diverse coverage from media devoid of bias, such as GCA Mortgage Forums News. There is a need to monitor key developments, especially the Fed’s pronouncements and market predictions by other credible sources on the financial news
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Can you elaborate on the factors influencing gold and silver price forecasts for 2025?
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Understanding the Elements Determining the Future Price of Gold and Silver – as of 2025 As we look at the elements in this infographic, it’s pretty clear how they can aid us in giving estimates of the rates of Gold and silver in the year 2025.
These elements and their economic effects are broken down in a simpler manner below:
Economic Factors
Rates of Inflation:
- History shows that Gold and silver are the best protection against inflation.
- Investing in Gold and silver can help preserve one’s wealth during high inflation.
Value:
- During periods of great economic uncertainty or recession, there is usually a spike in investments in Gold and silver, as they act as safe-haven currencies.
Changes in Investments
Investment in Gold will generally grow with an increase in real interest rates and decrease with low or negative real interest rates (nominal rates with no growth).
Growth Rate of US Federal Depository Institutions
The Federal Reserve’s policies directly influence investment decisions in Gold and silver. In many cases, lowering rates generate higher prices for these metals.
Global Issues Affecting Gold and Silver Prices
Political Changes:
- Geopolitical tensions or conflicts can increase demand for Gold and silver, especially from a foreign investor’s perspective.
- Events like war, trade conflicts, and other major political shifts can significantly affect demand.
- The trade value of the currency and forex is of core importance as the value of Gold and silver are integrated with the significant international economic position of the US.
- If the dollar weakens, the prices of Gold and silver tend to increase as they are more appealing to foreign countries.
Buying And Selling Activity
Mining Production:
- There are new and existing sources of new Gold and silver. Still, their availability is contingent on the supply of effective mining.
- If the production cuts result from certain environmental restrictions, strikes of workers, or empty mines, there could be a price rise.
Industrial Demand:
- Silver is an important industrial metal (electronics and solar cells).
- As one of the industrial commodities, its price changes compared to the price of crude oil.
- At the same time, Gold is an investment commodity and does not change in value as often.
Changes in Spending Habits
Exchange-Traded Funds (EFT):
- The price of Gold and silver is most affected by the purchase and sale of gold and silver exchange-traded funds.
- Prices are appreciated when there is a heavy investment in the fund.
Retail Investment:
- The demand from personal investors for physical gold and silver bars or coins can also change the price range.
Economic Developments
Increase in mining and recovery—New, improved technological strategies for mining and recovery will constantly and positively alter the pricing structure.
Fever and enthusiasm
Investor Behavior:
- The psychology and sentiment of the market tend to change the prices.
- Increased sentiment encourages purchases, while excessive pessimism encourages sales.
Predicting the prices of Gold and silver in 2025 will require analyzing numerous factors. Prices in the future will largely be determined by the state of the economy, inflation, interest rates, the geopolitical situation, supply-and-demand, and even market mood. Therefore, these indicators and other metrics will be crucial when trying to anticipate sentiment in the precious metals market.
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On January 29, 2025, the Federal Reserve announced that it will retain the federal funds rate at the current range of 4.25% and 4.50%. On January 29, 2025, the Federal Reserve announced that it would retain the federal funds rate at the current range of 4.25% and 4.50%. This rate is retained after striking a pause following multiple rate cuts introduced in September 2024. This decision is coherent with market expectations alongside the central bank’s evaluation of some economic conditions.
The Federal Open Market Committee (FOMC) added that the latest calendar-year indicators show an economic growth rate that is sustained at decent levels. Lately, the unemployment rate has flatlined at lower margins, and the job market conditions are still quite healthy. However, inflation remains somewhat stubbornly high, and thus, the Fed has decided to remain on guard.
The chair believes that the central bank does not have to be eager to change policy, “We do not need to be in a hurry to amend our policy stance,” as the central bank would have helped themself out of policy problems.
This decision is made despite outside factors, like President Donald Trump’s demands for aggressive rate cuts to boost the economy.
The Fed’s insistence on keeping interest rates on hold shows its reluctance to listen to external agitation as it strives to uphold the utmost independence in the country’s monetary policy framework.
After the Fed released its statement, the markets’ reaction was somewhat contradictory. Primary U.S. stock indices declined slightly, with the S&P 500 Index down 0.5%, the Dow Jones Industrial Average down 0.3%, and the Nasdaq Composite down 0.5%. The yields on Treasury bonds remained unchanged, which may reflect investors’ view that these interest rates will not be changed any time soon.
As for prospects, the Federal Reserve adopted a stance with a component of a “do nothing law. “Simply put, more data will be needed to analyze any new rates. The rates seem set for the time being, but the data on inflation and employment will dictate eventual changes. As always, the central bank is trying to support growth while controlling inflation and achieving its price stability objective.
Is the rate retained after striking a pause following multiple rate cuts introduced in September 2024? This decision is coherent with market expectations and the central bank’s evaluation of some economic conditions.
The Federal Open Market Committee (FOMC) added that the latest calendar-year indicators show an economic growth rate that is sustained at decent levels. Lately, the unemployment rate has flatlined at lower margins, and the job market conditions are still quite healthy. However, inflation remains somewhat stubbornly high, and thus, the Fed has decided to remain on guard.
The chair believes that the central bank does not have to be eager to change policy, “We do not need to be in a hurry to amend our policy stance,” as the central bank would have helped themself out of policy problems.
This decision is made despite outside factors, like President Donald Trump’s demands for aggressive rate cuts to boost the economy.
The Fed’s Insistence on keeping interest rates on hold shows its reluctance to listen to external agitation as it strives to uphold the utmost independence in the country’s monetary policy framework.
After the Fed released its statement, the reaction of the markets was somewhat contradictory. Primary U.S. stock indices declined slightly, with the S&P 500 Index down 0.5%, the Dow Jones Industrial Average down 0.3%, and the Nasdaq Composite down 0.5%. The yields on Treasury remained unchanged, which may reflect the view of investors that these interest rates will not be changed any time soon.
As for prospects, the Federal Reserve adopted a stance with a component of an “o nothing law,” or simply put, more data will be needed to analyze any new rates. The rates seem set for the time being, but the data on inflation and employment will dictate eventual changes. As always, the central bank is trying to support growth while controlling inflation and achieving its price stability objective.
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Is President Trump upset at Fed Chairman Jerome Powell for not lowering rates on January 29th, 2025?
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Surely enough, President Donald Trump has not been pleased with Federal Reserve Board Chairman Jerome Powell’s choice to leave the rates as they are in the most recent FOMC meeting. Trump very vocally wanted the rates to be lowered before the meeting. After the announcement that it was clear that the federal funds rate would be left untouched at 4.25%- 4.50%, President Trump said, “Powell and the Fed did not manage to fix the problem they created with inflation.” He went on to repeat his campaign promises to increase the energy quota and boost manufacturing in the country to solve these issues.
Regarding the President’s comments, Chairman Jerome Powell maintained that the Fed did not feel the need to change its policies due to the comments made by Trump. He added that when the Federal Reserve acts, it is always based on economic information and circumstances: “There is no need to rush to change our policy position.” Powell did not focus on the statement made by the President, spending more time on the Fed’s commitment to its primary objectives, which are fostering as many jobs as possible while ensuring that inflation is kept in check.
The above account demonstrates how friction between the White House and the Federal Reserve regarding the reasons behind the policies is bound to continue.
While the President pushes for more proactive rate cuts to encourage economic growth, the Federal Reserve remains cautious and tries to balance inflation and economic growth.
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What actions will President Donald Trump and the Trump administration take for Federal Reserve Board Chairman Jerome Powell not lowering interest rates?
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At present, there is no evidence suggesting that President Donald Trump or any of his administration wished to impose sanctions against Federal Reserve Chairman Jerome Powell after the decision to keep interest rates the same on January 29, 2025. The Federal Reserve functions as a self-sufficient body. The President can make comments, but central bank policies are made based on analyses and data.
In the past, President Trump has openly criticized Chairman Powel’s monetary policies, especially his reluctance to lower interest rates as one of the major tools to increase economic activity. Still, he has not moved to dismiss or replace Powell. In any case, it should be made clear that the President does not have such arbitrary power to get rid of the Chairman of the Federal Reserve; there has to be sufficient reason and procedure to allow for such a decision.
President Trump will have avenues to exercise power over the Federal Reserve through forthcoming appointments. Chairman Powell’s term will end in May 2026, while other positions in the Federal Reserve’s Board of Governors will be available even before that. These are important as they will permit the government to determine the Federal Reserve’s strategy concerning monetary policy.
To sum up, although President Trump remains unhappy with the Federal Reserve’s latest action, it does not seem that he is actively trying to take action against Chairman Powell. The administration will continue to pursue its preferred economic policies while observing the Federal Reserve’s independence.
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