In exciting news, Florida’s legislature approved $362 million that will help advance homeownership and other related housing programs. Advocacy by Florida Realtors®, including significant efforts by Greater Tampa REALTORS®, played a large role in this success.
This amount includes an astounding $100 million for the Hometown Hero Housing Program, a new avenue of down payment and closing cost assistance for hometown heroes, such as firefighters, law enforcement officers, teachers and nurses.
It is a bright spot in otherwise uncertain news for prospective and current homeowners today.
As expected, the Federal Reserve raised interest rates a quarter-point, the first of up to seven planned increases this year. While Fed Chair Jerome Powell anticipates a strong economy through 2022, despite ongoing high inflation and a tight labor market, analysts don’t share his optimism that the U.S. will avoid a recession.
On the news of rate hikes, the 10-year yield has moved higher. This has in turn pushed the average rate on a 30-year fixed rate mortgage to 3.85% as of the week of March 9, and a year ago it was 3.05%, according to Freddie Mac. The prospect of higher rates has begun to reduce refinancing demand, and rising mortgage rates will likely create even more difficulty for those house hunting.
In Florida, while we received good news from state legislature, lawmakers also failed to address the state’s property insurance crisis.
Among concerns, the National Association Home Builders’ (NAHB) monthly confidence index fell to the lowest level since September. The NAHB cited shortages of both labor and lumber, as well as increased new home prices. NAHB Chairman Jerry Konter urged the Biden administration to increase domestic production of timber from federal lands and to work with Canada on a new softwood lumber agreement that will eliminate tariffs.
Finally, it’s clear a return to anything resembling normal in our industry is unrealistic as the so-called “great reshuffling” continues. Migration first fueled by the pandemic, then remote work opportunities, is now propelled by high home purchase costs and inflation. Strong referral networks appear to be a key to success in this evolving market.
There is much to watch during the next several months. Please know your team at GTR is keeping an eye on trends and changes and remains flexible and responsive.