The Real Estate News Brief; Fed’s Rate Hike Plan, Record Home Price Growth, Real Estate Career SurgeIn this Real Estate News Brief for the week ending May 7th, 2022... the Fed fights inflation with rate hike, home prices hit new record high, and the popularity of a career in real estate.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week, and words from the central bank that touched off a dramatic roller coaster of gains and losses on Wall Street. Fed Chief Jerome Powell sat down with the press for an hour on Wednesday after a decision by Fed officials to raise the Federal Funds rate by 50 basis points. Powell said that inflation is too high but essentially nixed the idea of a 75 basis point rate hike. He also suggested the possibility of two more 50-basis point rate hikes during the next two meetings. (1)His comments about shelving a more aggressive rate hike plan triggered a huge stock rally with the Dow gaining at least 900 points. But the exuberance didn’t last long. Stocks fell harder on Thursday than they flew higher on Wednesday, and the losses continued on Friday. So there’s still plenty of uncertainty about where our economy is headed. But Powell’s comments were encouraging. Among his comments: “We need to do everything we can to restore stable prices as quickly and effectively as we can. We think we have a good chance to do it without a significant increase in unemployment or a really sharp slowdown.” (2)So how do the rate hikes affect consumers and investors? They are directly linked to higher rates for credit cards, student loans, car loans, and adjustable-rate mortgages. They will also influence mortgage rates, although they are not directly linked. On a positive note: higher mortgage rates along with high home prices are expected to result in a cooler and more normal housing market. But how high will mortgage rates go? Lending Tree’s senior economic analyst, Jacob Channel, is predicting that the 30-year fixed-rate loan will hit 6% by the end of the year. (3) I think it will hit 7%.There were 200,000 initial jobless claims last week which was an increase of 19,000 from the week before. It was the biggest weekly increase since almost a year ago, but continuing claims decreased by the same amount, but they remain at their lowest level since early 1970, at 1.38 million. (4)U.S. companies also added almost a quarter million new jobs in April, but there are still far too few workers to fill all the open positions. In March, there were a record 11.5 million jobs that needed filling. The unemployment rate is currently at 3.6% which is slightly higher than a 54-year low. (5) (6)Construction spending was slow in March, because of a drop in non-residential spending. Money spent on all kinds of residential construction was up 1%. That’s mostly due to a 1.3% increase in single-family home construction that was offset by a drop in spending on multi-families. (7) Mortgage RatesMortgage rates moved higher again this last week. Freddie Mac says the 30-year fixed-rate mortgage was up 17 basis points to 5.27%. That’s the highest it’s been since 2009. The 15-year was up 12 basis points to 4.52%. (8) The Mortgage Daily News says the average 30-year was even higher, at 5.55%. It also warned that home affordability is close to the worst it’s ever been. At the start of the pandemic, 6% of U.S. housing markets were less affordable than long-term levels. That percentage is now up to 95%. (9) In other news making headlines…Home Price Growth Hits Record HighThe latest report from CoreLogic is out on home price growth in March. According to this report, it was up a record 20.9% year-over-year. If that number isn’t impressive enough, CoreLogic says the March increase was the 122nd month in a row that home prices have gone up. (10)Chief economist Frank Nothaft says when you combine home price growth with hig