Have you heard the good news?
There’s a Jesus joke there, but I’ve learned over the years that people don’t take kindly to the suggestion that the Gospel’s fiction. (“Nobody f-cks with the Jesus.”)
The good news on Thursday was that the average 30-year fixed sported a five-handle on Freddie Mac’s weekly update for the first time since early September 2022.
As the chart notes, this comes just in time for the spring home-buying season.
I’m skeptical it’s enough, which is to say I doubt a big thaw’s in the offing. Then again, I’ve long argued that the return of five-handle financing costs, if sustained, could mark a turning point. I still believe that.
There’s math here. Thankfully, Redfin did it (the math) so the rest of us don’t have to. Or, more aptly in 2026, so the rest of us don’t have to ask Claude to crunch the numbers.
The decline in rates to multi-year lows leaves the median monthly housing payment at “just” $2,599, Dana Anderson noted this week. That’s obviously up since 2019, but it’s nearly 3% lower versus the same period a year ago.
The figure above shows you what you can afford, in terms of home price, for a given monthly payment at a given rate for a 30-year mortgage.
Do note the caveat in the subheader: You still have to come up with what, assuming the median household income and the median home price, is a year’s pay (before taxes, I should add) for a down payment. The numbers used for that chart assume 20% down.
“Even though rates have come down and affordability is improving, prospective buyers have faced some headwinds since the start of the year,” Anderson remarked, adding that “some Americans are jittery about economic uncertainty, including concerns about layoffs and the stock market.”
Challenges aside, the drop in rates works out to around $35,000 in additional buying power versus last year’s highs on the 30-year fixed. Applying that to the second chart above, the implication is that if your monthly housing budget’s $3,000 (and in the post-pandemic era, it better be at least that or you may as well not bother), you can buy a $480,000 home versus a $445,000 house this time last year.
Separately, but relatedly, a new survey conducted by Redfin found that two-thirds of GenZers struggle either occasionally or regularly to make their monthly housing payment. Suffice to say they haven’t heard the good news.
When I see multiple buyers lining up to tour my properties, then I know I can start raising prices again.
Like Mr. Quintana said, “Are you ready to be f-/ked, man?”
“Jack Dorsey’s Block Slashes 4000. Nearly Half Its Staff in AI Bet.” —BBG
XYZ up 27% on the news. Going to be a lot of meetings next week about expediting AI deployment and headcount reductions. Might reduce the demand for Northern CA real estate a little bit.
Selling out and moving may not be a wise decision. Management will probably be quietly offering you “consulting contracts” or hiring you back in less than a year.
Since I don’t have anything constructive to add, here’s some movie trivia.
While filming Turturro’s famous, “Stick it up your ass and pull the trigger ’til it goes, ‘Click,'” monologue, John Goodman and Jeff Bridges couldn’t keep it together. Their laughter kept ruining takes, so eventually the Coen brothers kicked them off the set. Turturro ultimately delivered all his lines directly to the camera with no one actually in front of him.
The scenes with the Jesus were perfect. I know that no one really cares that they made a movie about the Jesus, but that’s a character that they should never try to expand on beyond his appearance in The Big Lebowski. His scenes are the only window into his existence the world could ever need.
I liked “The Jesus Rolls.” I can’t honestly recommend it to everyone — it is out there as far as the plot goes — but I actually enjoyed it. It has a great cast.