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The builder’s trade group provides a snapshot of how increasing borrowing costs could gradually price out more would-be buyers.
Record-low jumbo loan rates and rapid home price growth fueled an increase in jumbo lending last year.
“The cascading impacts of the war in Ukraine have created market uncertainty,” says Freddie Mac’s chief economist.
“When global investors sense increased uncertainty, there is a ‘flight to safety’ in the U.S. Treasury bonds,” one economist says.
Rates may increase while purchasing a house, and with home buyers already stretching their budgets, that difference could have a big impact.
“As interest rates rise in the coming year, you could see folks using more second-lien products," says an Urban Institute analyst.
Lawmakers in support of the bill hope the offer will attract more young people to own a home in the state.
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