As a New York Federal Reserve Bank analysis this week shows, low interest rates fueled a refinance boom, which continues to support home prices and consumer spending.
Home prices have increased by 35% since the start of the pandemic
Supply remains historically tight because homeowners are reluctant to sell. Home prices have declined from their peak last autumn but only modestly.
As a result, more young people are renting, which is pushing up rents.
In such metro areas as New York City and Miami, many residents with four-bedroom homes have locked in monthly mortgage payments that are less than half the rent on a one-bedroom apartment. No wonder young people are preoccupied by economic inequality.
The Wall Street Journal Editorial Board 16 May 2023
The 30-year mortgage fell down to 2.65%. 14 million mortgages were refinanced
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