May 10, 2024
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May 10, 2024

How Long Can Consumers Hold Up?

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No news is good news, so to speak. There was very little economic data that came out this week. The good news is rates dropped again this week, creeping down closer to the 7% level.

Consumer spending makes up about 2/3rds of Gross Domestic Product or GDP. GDP is the government's measuring stick of the economy. Because the consumer is the key driver of GDP, we must ask: how long the consumer can hold up?

The issue coming in the next few months is the substantial dwindling of savings and the incredibly high credit debt. While April is typically stronger than most months for consumer spending because of the tax refund checks, this money will be gone before you know it.

Summer vacations will just add to the credit and savings issues. Come the fall and going into the election, the consumer could very well be flat on their back hoping to be resuscitated. At this point, the Fed may start to cut the Fed Funds rate.

Next week is the release of the Consumer Price Index (CPI). We don’t see any major surprises coming. Core inflation will likely drop a tad, which is a positive but not earth-shattering. As long as CPI doesn’t go up, we should see a continued trend downward for rates.

We took an unofficial poll at Las Vegas Pitch this week in Henderson on whether there was more buyer activity and multiple offers now than a month ago. Over 90% of the agents said activity is up. Buyers sitting on the sideline should seriously consider getting off the fence and buying now. Home values will almost certainly be higher a year from now given the low supply of homes.

Video Transcript for
How Long Can Consumers Hold Up?
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Bill Gaylord
Gaylord-Hansen Team at CrossCountry Mortgage

The information contained is the viewpoint of the presenter(s). Individuals should consult their own financial representative.

Estimated Mortgage Payment is for exemplary purposes only. Contact a licensed loan officer for exact numbers and APR. Additional rates and terms may apply and are subject to change without notice. Loan scenario assumes a purchase price of Zillow's list price and a 10% down payment. Points and fees not included. Property tax, homeowners insurance, mortgage insurance, and HOA fees are approximate and may vary. Other fees may apply. Product displayed is a conventional 30-year fixed rate mortgage using the current average rate as shown on Mortgage News Daily (

Estimated Qualifying Income assumes a homebuyer has a FICO score above 740, no other credit debt, and a debt-to-income (DTI) ratio of 43%.

For exact numbers and APR or to run a loan scenario based on your own credit and income, contact our office at (858) 259-8700.

Rate Source: Mortgage News Daily. Rates displayed are approximate, subject to change, and do not necessarily reflect rates available to you. MND’s methods involve an objective component based on lenders' raw prices as well as a subjective impression from their network of originators. For more information about how these rates are calculated, visit

Mortgage News Daily (MND) is a trademark of Brown House Media, Inc. Zillow is a trademark of Zillow, Inc. CrossCountry Mortgage has not been authorized, sponsored, or otherwise approved by Brown House Media, Inc. or Zillow, Inc.

Equal Housing Opportunity. All loans subject to underwriting approval. Certain restrictions apply. Call (858) 259-8700 for details. All borrowers must meet minimum credit score, loan-to-value, debt-to-income, and other requirements to qualify for any mortgage program. CrossCountry Mortgage, LLC is an FHA Approved Lending Institution and is not acting on behalf of or at the direction of HUD/FHA or the federal government. CrossCountry Mortgage, LLC is not affiliated with or acting on behalf of or at the direction of the Veteran Affairs Office or any government agency. Certificate of Eligibility required for VA loans. By refinancing, the existing loan total finance charges may be higher over the life of the loan.

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