It’s finally March, and signs of spring are here; however, that didn’t stop Mother Nature from delivering a final snowstorm out West and in the Midwest. As we closed out February, stocks ended the month in the red. Stock volatility is something we’re going to have to get used to following the pandemic. Investors are now adjusting to a new reality where stock prices can swing wildly in response to various factors, making volatility a more persistent feature of the investment landscape.
Housing Market
We saw mortgage rates increase again steadily over the past few months. This is likely disheartening news for many potential homebuyers as the Federal Reserve is signaling more rate hikes are inevitable. While previous hikes have had the desired effect on the housing market, their impact on general inflation has been slow. While the Fed attempts to find the balance between slowing the economy and lowering inflation, it sees increased rates as the primary tool. Unfortunately, for buyers, this means the cost to borrow money will be higher, and buyers will need to accept mortgage rates that haven’t been seen in over a decade.
Additionally, we saw home sales decrease again, which shouldn’t be a big surprise. Home inventories have been climbing, and homes stay on the market longer than the previous year. This is good news for buyers who must relocate this summer. They will have increased selection and more bargaining power than in the past two years. I wouldn’t say it’s a buyer’s market yet, but it looks a lot better. To view current mortgage rates, you can visit Freddie Mac.
Electric Vehicles
As gas prices stay elevated, Electric Vehicles (EVs) continue to be viewed as reducing the pain at the pump by avoiding hefty fuel prices. The EV network within the country is not mainstream yet and will take significant time to build. That said, EVs are still being looked at to offset increased costs and possibly be more environmentally aware.
Tesla announced an ambitious goal of selling millions more cars over the next decade. Additionally, the company stated it plans to build a car factory in Mexico to expand operations. Furthermore, Elon Musk noted the need to have more model vehicles to meet the new sales goals. No specific details were made, but we know the Tesla Cybertruck is coming. Rumors are scattered, but it’s assumed it’ll debut at the end of the year or the beginning of 2024.
Student Loans
If you’re one of the millions of student loan borrowers, you might have been following the court argument regarding President Biden’s student loan forgiveness. Last year, Biden attempted to take executive action and forgive $10,000 from student loan borrowers. There was swift outcry on this action, and questions arose if the President has this authority. Ultimately, the argument went to the courts, and the Supreme Court is now hearing the case. Regardless of your stance on this subject, there are no questions that higher education has become increasingly expensive. While there are multiple ways to keep college costs down, attending a four-year college will cost you thousands of dollars per semester. The court case will continue next week, and it’ll be interesting to see how the Supreme Court justices will rule in the case that will affect millions of people. For tips on saving and preparing for college be sure to check out our three-part college series.