WSJ Your Money Briefing - How Market Volatility Can Affect Homeowners and House Hunters

Episode Date: April 16, 2025

Mortgage rates have gone up since last week’s market volatility. Wall Street Journal reporter Veronica Dagher joins host Julia Carpenter to discuss what this means for homeowners and potential home buyers. Further Reading  How to Make Major Money Decisions Right Now: A WSJ Guide  Buying a Home in 2025: Navigating the Crunch - WSJ  Sign up for the WSJ's free Markets A.M. newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Hey, your money briefing listeners. This is Julia Carpenter. Here at YMB, we're all about bringing you important personal finance and career news. We're working on making some changes to our content and we want to hear from you. Our question today is, what would be the ideal length of the show? Five to eight minutes, eight to ten minutes, ten to fifteen minutes, fifteen to twenty minutes, 10 to 15 minutes, 15 to 20 minutes, 20 to 30 minutes, or over 30 minutes. If you're listening on Spotify, look for our poll under the episode description. Or you can send us an email to ymb at wsj.com. That's ymb at wsj.com. Now onto the show. Here's your money briefing for Wednesday, April 16. I'm Julia Carpenter for The Wall Street Journal. Had you dreamed of buying a home this spring? Or maybe you're still hopeful about refinancing.

Last week's turbulent market might have upended expectations for buyers, sellers, and homeowners. So if you're putting everything you have into your home and we know that the home prices are up, we also know things like home insurance, property taxes, homeowners association fees, all those things are so much higher now than they were in the past. And so to take on this big responsibility during a time where things may feel unstable for you, it may not be the right decision. We'll hear more from Wall Street Journal reporter Veronica Dagger on how a volatile stock market can affect your homeownership plans.

That's after the break. The recent market volatility means some house hunters are reconsidering their timelines, and homeowners may be thinking twice about refinancing. But how should you strategize going forward? WSJ reporter Veronica Dagger joins me. Veronica, homeownership is still such a core part of building wealth in this country. Can you talk a bit about how instability in the market affects house hunters? It's so tough to be a house hunter today. It's actually been tough for quite a

while just because there's such a shortage of inventory, not a lot of homes for sale. And lately mortgage rates are going in the wrong direction. They're going up. Earlier this week I looked and they were at 7.07 percent and that's from Mortgage News Daily. And that's really discouraging to a lot of buyers who are already facing high home prices. There's so much house hunters can't control. And you interviewed some financial professionals who suggested instead focusing on what they can control. What did they have to say? Exactly. Focus on things like your budget, how much home you can afford, not taking on too much debt. Also think about your job. Are you feeling

stable in your job right now? Think about your overall cash flow. Again, you don't want to be saddled and dead if you're already facing high student loans and credit card bills. And also understand like you don't have to be a homeowner anymore. That's less of a societal norm. It still is very popular. A lot of people still want to do it, but some people want to rent for the rest of their life and that's okay too. You don't have to fit into a certain mold. You have to do what's best for you and your budget and just feel secure and be able to sleep at night with whatever decision you make.

A lot of people put everything they have saved into buying a home and moving in. But you wrote in your story that being house poor now could be more dangerous than ever. Yes, because the economy is feeling pretty unstable for a lot of people. More CEOs are expecting recession in the near future. That could mean more layoffs. Also if you're putting everything you have into your home and we know that the home prices are up, we also know things like home insurance, property taxes, homeowners association fees, all those things are so much higher now than they were in the past.

And so you've got this budget for just the basic upkeep of your home, also repairs cost more, all these things are so much more expensive now. And so to take on this big responsibility during a time where things may feel unstable for you, it may not be the right decision. You have to do what's best for you. Maybe you don't feel any of these cross-currants, maybe you are feeling stable and that is fine, then go for it. But you just don't want to be in a situation where essentially you need a new roof for your home but you're worrying how you're going to pay for it or you're going to

have to rack up all this credit card debt in order to pay for it. As someone who doesn't own a home, but who really wants to, you're definitely making me feel a little better and comforted. But for those who've already become homeowners, what does this turbulent market mean for them? It's one of those things that if you plan on staying in your home for quite a while you probably don't have to worry a whole lot. Again, if you can make your mortgage payments you probably don't have to think too much about it. It's only the folks who are really looking to sell right now and need to unload that house

are finding some difficult times depending on where they live in the country. For example, if they live in the country. For example, if you're in the South, places like Texas or Florida, you're probably going to have to lower the price of your home in order to sell it. You're probably not going to see bidding wars depending on where you are, and your home is going to sit on the market longer. However, if you're a seller in a place like New Jersey or New York, you're still going to see those bidding wars in general.

You're still going to get multiple offers, top dollar for your home. Your story, which is linked in our show notes, mentioned an intriguing possibility for some homeowners that they could ask their lender to modify their mortgage rate for a set fee. How does that work and what are the advantages? Any disadvantages? Not every lender wants to do this. They only want to do it for people with certain credit scores. They only want to do it for people who are of certain income level. So there's a lot of ifs to this and also not every lender does it. However, if you're able to reset

the mortgage rate, you essentially call up your lender, ask for them to reset it to current rates in the market. There's usually a fee, maybe about $ to reset it to current rates in the market. There's usually a fee, maybe about $2,000 or so depends on the lender. They don't have to approve you for it. And it saves you a lot of time and money because it's sort of an alternative to a full refinancing, a whole refinancing. It's a lot more paperwork, a lot more expense and a bigger headache for folks. But this rate reset, it's easier to do, and folks like it. And when you say that it's only available for people with a certain income or a certain credit score, I'm assuming that means high income, high credit score.

Generally, yes. Well, you mentioned that rates are going higher. So much in homeownership depends on that mortgage rate. Can house hunters and homeowners alike expect to see lower rates anytime soon or even later this year? We have been hoping for that kind of lowering of rates significantly for at least the past year and it hasn't happened. What keeps happening is the rate keeps bouncing around, range bound in the sixes, and now we're going up again. It's very difficult to bet on rate changes, decreases.

There's a lot of people out here right now who were hoping that this was the year that they were going to be able to refinance, and they can't. And some folks are having trouble making their mortgages because of that. We're seeing this just like a little bit on the margins, a little bit more, especially people who are lower income homeowners. We're seeing a little bit more delinquencies, not in a big way yet, but it's something to think about. If you are banking on refinancing and that day doesn't come when you need it to come, you could be in a tight situation budget-wise. That's WSJ reporter Veronica Dacker. And that's it for your money briefing. If you want to hear more about what the housing market has in store, catch up on our recent series

Buying a Home in 2025, Navigating the Crunch. We'll link to it in our show notes. This episode was produced by Ariana Asparu with supervising producer Melanie Roy. I'm Julia Carpenter for The Wall Street Journal. Thanks for listening.