On The Market 2025 Mid-Year Mortgage Rate Predictions (Update)
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Jul 24, 2025 Will mortgage rates finally drop in late 2025? The latest predictions suggest rates may linger in the mid to high sixes due to inflation and economic uncertainty. Insights into the bond market reveal how these factors influence investor confidence. The podcast also discusses the relationship between the labor market and mortgage rates, the impact of national debt, and the evolving strategies for real estate investors. It's essential information for navigating today's challenging mortgage landscape.
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Mortgage Rates Stagnate at High Levels
- Mortgage rates have remained stubbornly high around 6.75% in 2025, barely dropping since last year.
- Rates need to dip below 6%, ideally near 5.5%, to significantly boost housing market activity.
Bond Market Dictates Mortgage Rates
- Mortgage rates track bond market yields, not the Fed's short-term rates.
- A stalemate between inflation fears pushing yields up and recession fears pushing them down keeps rates flat.
Fed Independence Impacts Rates
- Fed independence tensions, especially between Trump and Powell, add uncertainty impacting bond investors.
- Risk that political interference could lead to higher inflation keeps bond yields and mortgage rates elevated.
