Michael RushReal Estate Broker, Keller Williams Realty DTC · Real Estate Broker at Keller Williams Realty DTC

The stock market crashed, is real estate next?!

13 Aug 2024 · 0 min

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In this commentary, the speaker highlights that the United States is experiencing a three‑year high unemployment rate and that five of the last six employment reports have been revised downward, indicating a weakening labor market. He notes a recent stock market crash that appears to be moving the market into correction territory. He then argues that, paradoxically, this financial turmoil could be beneficial for mortgage borrowers because the resulting losses in 401(k) retirement accounts are likely to prompt the Federal Reserve to lower the federal funds rate, which in turn would drive mortgage interest rates down.

We're at a 3-year high on our unemployment rate, and 5 out of the last 6 jobs reports have been revised lower. Last week we had a stock market crash, and it's definitely looking like we're in correction territories. This is actually ironically good for mortgage interest rates because when our 401s are taking a hit, mortgage interest rates are actually going to come down along with the Fed funds rate.