Prospective homebuyers have been waiting for more affordable conditions, and according to data from the Mortgage Bankers Association, they might be ready to start making offers. Mortgage demand surged 7% in the week ending January 20th after skyrocketing nearly 28% the week prior. While there have been variations in mortgage demand, often following fluctuations in the federal funds rate, a 28% increase in the volume of mortgage applications hasn’t occurred since the first week of March 2020. 

Meanwhile, inventory isn’t growing to keep pace. Homebuyer sentiment improved slightly in December. Inflation is moderating faster than some recent expectations, and a growing cohort of economists are betting the Fed will pull off a soft landing. Did we manage to avoid a housing market crash, and is the housing market already making a comeback? 

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