Impact of Mortgage Rates on Housing Market

Current mortgage rates are significantly affecting the housing market, with rates hovering between 6.75% and 7.5%, resulting in negative housing demand trends. The impact of these rates is evident as housing starts and permits remain at recession-level lows, creating challenges for builders. A lower mortgage rate would facilitate more affordable housing by reducing payment amounts for potential buyers. Thus, achieving affordable housing necessitates either lower mortgage rates or an increase in new home construction.