Mortgage Rates Show Resilience Despite Jobs Report, 2024 Outlook Remains Positive

Mortgage rates have been steadily dropping and fell further this week, with 30-year mortgage rates holding below 7% in December. The November jobs report showed a strong labor market, indicating that the Federal Reserve is likely to keep the federal funds rate steady at its upcoming meeting. There is speculation that the Fed may cut rates in 2024, leading to further declines in mortgage rates. However, the effects of previous rate hikes and elevated inflation are still being felt. As long as inflation and the labor market cool, mortgage rates should continue to decrease, but the Fed has indicated a willingness to hike rates if necessary. Home prices are expected to increase in 2023 and 2024 due to limited supply. Pros and cons of fixed-rate and adjustable-rate mortgages are discussed, with advice on choosing the right option based on individual circumstances.