What Does It Really Cost to Run an Airbnb or Rental Property?

There has been much anticipation of lower mortgage rates, but we have yet to see any consistency of that happening. The stock market has been down, along with inflation and consumer spending. In most markets, these factors would signal downward mortgage rates. But currently there is lack of confidence in the Fed lowering and or changing their current stance. In May I believe we will see some slow movement lower, as some positive economic data this month could push the average 30-year fixed mortgage rates down to 6.75% and 6.375% for the 15-year fixed. Also, ARM loans have emerged again as options with lower rates that should be considered. The 7/1 ARM should land about 5.875%.

Mortgage rates surged in April following the announcement of widespread tariffs early in the month. While rates remained elevated for much of the month, they began to decline toward the end, hinting at a potential return to pre-announcement levels. Looking ahead to May, rates are expected to ease further as markets find more stability. However, upcoming economic data — particularly the jobs report and inflation data — could spark renewed volatility if results deviate from expectations.

Mortgage rates are expected to remain in the mid-to-upper 6% range in May, amid ongoing worries over tariff-induced inflation and a softening in both business and consumer sentiment. Most market watchers anticipate that the Federal Reserve will hold rates steady at May's FOMC meeting. Significant attention will be focused on Fed Chairman Jerome Powell's remarks during the FOMC press conference.

Mortgage rates, whether they linger between 6.4% and 6.6% or shift in May 2025, are merely one factor in a complex equation. Inflation, Federal Reserve actions, and global uncertainties undeniably influence rates, but true opportunity for homebuyers hinges on market dynamics, personal financial stability, and timing. Affordability isn't dictated solely by rate fluctuations — it's shaped by income growth, escalating home prices, and individual debt capacity.

Be Ready to Move Quickly

Indecision can lead to failure or missed opportunities. Although the housing market is becoming more balanced than the recent past, it still favors sellers. Buyers should get pre-approved (not pre-qualified) for their mortgage, so that the seller has some certainty about the deal closing. And be ready to close quickly — a long escrow period will put you at a disadvantage.

Shopping Around Isn't Only for the Holidays

Since interest rates can vary drastically from day to day and from lender to lender, failing to shop around likely leads to money lost. Lenders charge different rates for different levels of credit scores. Get multiple quotes from multiple lenders and leverage them against each other.