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S3|E14: June Newsletter Recap · Life. Money. You.® Podcast

• 0:11
  SPEAKER_00: Hey everyone, and welcome back to another episode of the Life Money You Podcast.
• 0:17
  SPEAKER_00: I'm Dani Bushik, program manager and podcast host, and today we are sharing your monthly housing market update for our June newsletter recap.
• 0:27
  SPEAKER_00: What's happening right now, what it means for you, and how to think about housing decisions through the lens of overall financial well-being.
• 0:36
  SPEAKER_00: So, whether you're dreaming about buying your first home, considering a move, or just trying to make sense of all the headlines, this episode is for you.
• 0:46
  SPEAKER_00: Let's get into it.
• 0:48
  SPEAKER_00: If you've been paying attention to the housing market lately, you've probably noticed a few things.
• 0:54
  SPEAKER_00: Higher home prices, fewer homes for sale, and a whole lot of uncertainty.
• 1:00
  SPEAKER_00: The good news?
• 1:01
  SPEAKER_00: We've recently seen an increase in active listings, and interest rates have stabilized.
• 1:07
  SPEAKER_00: The challenge is that the broader economy still feels unsettled.
• 1:11
  SPEAKER_00: Global conflict continues to impact energy prices and the overall cost of living.
• 1:16
  SPEAKER_00: Inflation remains a concern, which means interest rates may not come down as quickly or as much as buyers had hoped.
• 1:25
  SPEAKER_00: And all of that makes hesitation around big financial decisions completely understandable.
• 1:30
  SPEAKER_00: And yet, despite these challenges, home ownership remains one of the primary ways households build long-term wealth.
• 1:38
  SPEAKER_00: If the numbers work and the timing is right, buying a home can still be a viable and meaningful investment.
• 1:46
  SPEAKER_00: So let's talk about rates for a moment.
• 1:49
  SPEAKER_00: Mortgage rates are currently in the mid-6% range.
• 1:53
  SPEAKER_00: And that may feel high, especially if you remember the historically low rates of just a few years ago.
• 1:59
  SPEAKER_00: But here's the context that often gets missed.
• 2:02
  SPEAKER_00: Over the last 40 years, the historical average mortgage rate is about 7.5%.
• 2:08
  SPEAKER_00: And that's according to Callahan and Freddie Mack.
• 2:12
  SPEAKER_00: Those unusually low rates reset expectations.
• 2:16
  SPEAKER_00: So today's environment can feel tougher than it is from a long-term perspective.
• 2:21
  SPEAKER_00: That said, affordability is still stretched.
• 2:24
  SPEAKER_00: Housing costs continue to outpace income growth, especially for first-time buyers in younger households.
• 2:31
  SPEAKER_00: If you're recently married, just graduated college, are simply tired of renting, programs like BCU's first-time home buyer program with low-down payments and flexible income and credit guidelines can help make homeownership more attainable.
• 2:48
  SPEAKER_00: Next, I want to get into the rent versus buy conversation.
• 2:52
  SPEAKER_00: I mean, it's changed.
• 2:54
  SPEAKER_00: Today it's less about doing what you should do and more about what works for your life right now.
• 3:00
  SPEAKER_00: Renting can offer flexibility, especially during uncertain economic periods.
• 3:05
  SPEAKER_00: But buying can still support long-term wealth for households with stable finances.
• 3:11
  SPEAKER_00: What's different now is how people even view homeownership.
• 3:15
  SPEAKER_00: For many buyers, especially first-timers, a first home isn't a forever home.
• 3:21
  SPEAKER_00: Many stay five to seven years, then move as careers, incomes, and family needs change and grow.
• 3:29
  SPEAKER_00: That shift is one reason we're seeing renewed interest and adjustable rate mortgages, otherwise known as ARMs.
• 3:37
  SPEAKER_00: Arms typically start with a lower introductory rate than fixed-rate mortgages, which can make them attractive if you know you won't be in the home long term.
• 3:46
  SPEAKER_00: The rate adjusts over time, and if your plans or the market change, refinancing may be an option.
• 3:52
  SPEAKER_00: For some buyers, flexibility today matters more than stretching affordability up front.
• 3:58
  SPEAKER_00: Callahan data shows many Gen Z consumers lack confidence when it comes to financial institutions, savings options, and big decisions like homeownership.
• 4:07
  SPEAKER_00: And that's understandable.
• 4:09
  SPEAKER_00: The environment is complex.
• 4:12
  SPEAKER_00: But here's the encouraging part: strong habits matter more than perfect timing.
• 4:17
  SPEAKER_00: If homeownership is a goal now or later, here are three fundamentals that can make a big difference.
• 4:23
  SPEAKER_00: First, emergency savings.
• 4:25
  SPEAKER_00: Aim to build three to six months of expenses to protect yourself from surprises like home repairs, car repairs, medical needs, or job changes.
• 4:34
  SPEAKER_00: You're going to hear it quite a bit here, but emergency savings are always key.
• 4:40
  SPEAKER_00: Second, down payment planning.
• 4:42
  SPEAKER_00: Depending on your lender and available programs, down payments can range from 10 to 20%, or sometimes less with first-time buyer options.
• 4:51
  SPEAKER_00: And again, we have one at the credit union, so we'll link that in the show notes.
• 4:56
  SPEAKER_00: And third, credit and equity education.
• 4:59
  SPEAKER_00: Better credit typically means a better rate, which can save you a lot of money over time.
• 5:04
  SPEAKER_00: And understanding how equity builds through your down payment and monthly principal payments creates options for the future.
• 5:11
  SPEAKER_00: These steps create flexibility, whether buying a home is your next move or not.
• 5:17
  SPEAKER_00: Homeownership can be a powerful wealth-building tool, but it isn't the right move for everyone, and it doesn't have to happen on anyone else's timeline but your own.
• 5:26
  SPEAKER_00: The best housing decision is one that supports your overall financial stability, not one that compromises it.
• 5:33
  SPEAKER_00: Whether you're renting, buying, or waiting, aligning your housing choices with your broader financial well-being is what truly sets you up for success.
• 5:41
  SPEAKER_00: If you'd like support along the way, we've linked helpful tools in today's show notes, including a home buying hub, rent versus buy calculator, today's mortgage rates, and of course, our free one-on-one financial coaching.
• 5:55
  SPEAKER_00: And if you enjoyed this episode, tell your family and friends.
• 5:58
  SPEAKER_00: Be sure to follow Life Money You on Apple Podcasts and your favorite podcasting app.
• 6:03
  SPEAKER_00: Until next time, folks, thanks for tuning in.