Mortgage rates have shot upwards, rising above 6.5% last week according to the Mortgage Bankers Association (MBA), while economic uncertainty and higher oil prices are keeping many potential homebuyers on edge.
The prospect of another several weeks of war, then, is bad news for the housing and mortgage markets. But while the short-term picture is grim, mortgage professionals see better days ahead if the conflict does wrap up before the middle of the year.
“It all depends on [Iran] right now,” Loan Factory chief executive officer Thuan Nguyen (pictured top) told Mortgage Professional America. “Because of the war, we’ve seen the rates jump so high. And it’s already getting worse out there. Rates are so high, and business is slowing down.
“But for me and my company, we always look at the long term. And in the long term, rates are going to drop and people are going to refinance. In the long term, people will have to keep buying and selling houses. So it won’t affect our business.”
Continuing war ‘is going to slow everything down’
The conflict is currently stirring fears of an inflation uptick and persistent higher oil prices, a crisis that’s likely to worsen if a ceasefire remains out of reach and the Strait of Hormuz – a crucial oil passage that’s been blocked for weeks – stays shut.
