Happy first day of hurricane season, Houston. And while that might sound a little bit like saying "happy hunger games," let's talk about something a lot more exciting than storm prep: the Houston real estate market and what is happening with mortgage rates right now.

There is a lot going on this week, so let's break it all down in plain language.

What Is Driving Mortgage Rates Right Now?

If you have been following along, you know we have been talking about oil prices and inflation since March. That story is still very much running the show.

The PCE, or Personal Consumption Expenditures index, which is one of the Federal Reserve's preferred measures of inflation, came in significantly elevated this week. That is not great news for anyone hoping rates will drop quickly.

At the same time, GDP, which measures how much the United States produced and earned in the first quarter, came in negative. That sounds alarming but it is worth putting in context. With inflation running as hot as it is, we are likely to see stronger nominal GDP figures in the quarters ahead. The first quarter contraction may not tell the whole story.

A few other data points worth noting:

Durable goods orders jumped 7.9% in April. Durable goods are big-ticket items designed to last more than a year, think washers and dryers, appliances, and major equipment. A 7.9% increase is a significant number and may reflect tax refund spending making its way into the economy. The core reading, which strips out defense and aircraft, did fall 1.1%, so the picture is a bit mixed.

Jobless claims rose 5,000 to 215,000. That number is elevated enough to be worth watching as we head into the summer months.

The geopolitical wildcard: The president of Iran stepped down over the weekend, and while that development has the potential to ease oil price pressure over time, the situation remains fluid and unpredictable. The Strait of Hormuz continues to affect energy markets and by extension inflation and mortgage rates. Until there is real resolution in the region, rates are going to remain sensitive to every headline that comes out.

The bottom line on rates: Lock if you like what you see. The environment is volatile and the risk of rates moving higher is real.

What Is Happening in the Houston Real Estate Market?

Despite all of the economic noise, the Houston housing market is showing genuine resilience and there are some really encouraging numbers this week.

Closings were up almost 4%. A significant number of buyers pushed to get into their homes before Memorial Day, which contributed to a strong closing week. That kind of urgency tells you buyers are motivated and active.

Showings are up. Buyer interest has not faded even with rates where they are. People are still getting out, looking at homes, and taking the process seriously.

New listings are up slightly. More inventory is coming to market, which is a healthy sign for the overall balance of supply and demand.

Sellers are becoming more flexible on pricing. This is one of the most important developments in the current market. Because inventory levels have increased, sellers are no longer in a position to push prices aggressively. If you are a buyer, that flexibility is your opportunity.

HAR listing views are flat and off-market listings are up slightly, which suggests buyer interest is broad and not limited to traditional search activity.

Is It a Good Time to Buy a Home Right Now?

This is the question I get more than any other and here is my honest answer: it is generally always a good time to buy a home if you are financially ready and planning to stay put for a meaningful period of time.

Warren Buffett has a famous principle: buy fear, sell greed. When markets feel uncertain, that is often when the best opportunities exist for buyers who are prepared to act.

But let's back that up with actual data.

The Fannie Mae and Pulsenomics Home Price Expectation Survey projects that home prices will appreciate approximately 2.5% over the next year and roughly 14% cumulatively over the next five years.

What does that mean in real dollars? On a $500,000 home, 14% cumulative appreciation over five years translates to approximately $70,000 in equity growth above and beyond the principal you are paying down each month.

Now consider this: if you put 5% down on that $500,000 home, you are investing $25,000. Five years later, your equity growth from appreciation alone is projected to be $70,000. That is nearly a three-to-one return on your down payment investment, and that does not even account for the principal paydown that has been happening every single month.

That is a compelling case for buying now rather than waiting for conditions that may never feel perfectly ideal.

Self-Employed? The Big Banks Said No. We Have a Solution.

One of the biggest frustrations I hear from self-employed buyers is that they have strong businesses, healthy cash flow, and real financial strength, but their tax returns do not reflect that because good accountants minimize taxable income. And conventional lenders use tax returns to qualify borrowers.

If that sounds familiar, there is a path forward.

We offer a 12-month bank statement loan program that qualifies you based on actual deposits into your bank account rather than what your tax return shows. This program is available with as little as 10% down, which means you can get into a home without the massive down payment that most people assume is required when conventional lenders turn them away.

The big banks saying no does not mean no everywhere. It means you need the right lender who understands how to evaluate your real financial picture.

Coming Soon: A New Book on Building a Legacy Through Real Estate

We are putting the finishing touches on a new book focused on how to build generational wealth and a lasting legacy through real estate. It is currently in the proofreading phase and we will be sharing more details very soon. Stay tuned because this one is going to be worth your time.

The Bottom Line

Graduation season is wrapping up and summer is officially here. Historically, this is one of the most active periods for home buying and selling and the data is confirming that buyers are engaged and motivated in Houston.

If you have been sitting on the fence, here is what the market is telling you right now. Sellers are flexible. Inventory is improving. Home values are projected to grow meaningfully over the next five years. And for self-employed buyers, programs exist that most people do not know about.

The best time to act is when you are prepared, not when the headlines feel comfortable.

If you have questions about the market, your specific situation, or how to get started, give us a call. We are here to help.

8.122% APR based on a $650,000 purchase with 10% down and a 750 credit score for a 30-year fixed-rate mortgage. Monthly principal and interest payments are approximately $4,090.41. Escrow for taxes and insurance is required. Payment does not include taxes, insurance, or mortgage insurance; actual payment will be higher. Rates subject to change. Equal Housing Lender.

Rich at Habayit Home Loans Helping Houston homebuyers and homeowners navigate the mortgage market every week.