The unofficial start of the home buying season is the Presidents Day holiday weekend this month, with buyers typically snapping up properties through the end of May.
“There’s a lot of buyers out there who are intending to shop this spring,” says Mike Fratantoni, the Mortgage Bankers Association’s chief economist. There are other signs that buyers have housing on their minds. Touring activity has ramped up more quickly than it did last year, according to Redfin, using data from home tour company ShowingTime.
Consumers and economists agree that mortgage rates will head lower this year as the Fed cuts rates. The central bank doesn’t control the trajectory of mortgage rates itself; rather, the 10-year Treasury yield, which moves with market expectations for the economy, serves as a benchmark for mortgage rates.
Along with keeping an eye on the 10-year Treasury yield, it’s worth watching the economic data that can drive it. “We’re set up reasonably well for this spring buying season—but this potential reversal in the inflation path is the biggest risk right now,” MBA’s Fratantoni says.