We often marvel at the uniqueness of the Bozeman real estate market, but in certain areas, we are fully integrated into the national experience. One example: Mortgage interest rates.
While the FED raised rates 4 times in 2018, they have acted cautiously in 2019 and kept steady at each meeting. Mortgage rates corresponded and began the year at around 4.6%, as a result of the 2018 hikes. However, with the inaction on rates this year by the FED, mortgage rates have actually dropped to a two year low. Rates today were quoting about 3.6%, down from 4.6% in January. This can mean great news for housing, so long as there is inventory. In fact, in the Bozeman market, it can be less expensive on a monthly basis to purchase than to rent (again, a function of inventory). This is also good for lenders, as homeowners planning on staying put long term may find refinancing an attractive option now. Late 2018 predictions had interest rates seeing 5% in 2019...Clearly, that has not happened yet and things have trended in the opposite direction. Now the bond market is pricing at a 100% chance of a rate cut in July (a predictor by investors of what's to come)...What does that mean for mortgage rates? Well, we'll find out!