“The narrative seems to be that the Fed’s going to cut eventually – once this year, twice this year, maybe,” he said. “And so I think a lot of people say, ‘I’ll wait for the Fed to cut and then I’ll get back into this thing and I’ll look at rates.’”
What’s in store for the remainder of the year?
While mortgage rates may be elevated for now – at least by the standards of recent years – growing confidence on the direction of inflation and a potentially softening Fed outlook could point to more positive times ahead for borrowers, Valins added.
“I feel like the second half of the year [could see] more refinance opportunities even if rates stay the same,” he said, “because a customer will say, ‘OK – it’s been a year now. This makes sense. Six months ago, I didn’t need to rush into it – I had just got my mortgage. It’s now been a year, it’s now been 18 months. So if I can get that half-a-percent lower rate that you quoted me, or 1% lower, let’s do it.’”
That’s not to say either purchase or refinance activity is likely to see a boom before the year is out, he added – even though they could experience a marginal increase in traction. “More inventory, hopefully steady or slightly lower rates, and a bit more refinance should make for maybe a better second half than the first half,” he said. “But I’m not expecting any big growth, a big pop in volume on the purchase or the refi side.”
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