I want to congratulate everyone on making it through 2023 and wish you all a happy and prosperous 2024. Last year was quite the rollercoaster ride. We saw interest rates continue to climb during the first half of the year. The Prime interest rate currently sits at 8.50%...a full 5% higher than in March of 2022. This unprecedented increase was in response to high inflation brought on by pent up demand and supply chain issues caused in large part by the pandemic. All of us have felt the sting of inflation when shopping for just about anything. Inflation has come down to just over 3% in November, prompting the Federal Reserve Board to pause interest rate hikes and to actually start talking about rate cuts in 2024.
With housing affordability at a 40-year low, combined with 75% of mortgages locked in at 4% or below, the U.S. housing market is effectively frozen. Mortgage rates surged in 2023, hitting a high of 7.79% in October and the median home price in Utah is over $500,000. The outlook for lower interest rates in 2024 should start to make home ownership a little more affordable. In reality, most experts don’t expect a meaningful increase in home sales until mortgage rates return to a more “normal” upper 4% to lower 5% range. At Wasatch Peaks, we are cautiously optimistic about 2024. We feel like savers will continue to earn a good return on their deposits, while borrowers will start to see some relief in the form of lower loan payments.
There are other things to look forward to in 2024. This year is a leap year, so we all get one extra day in 2024…plus people with February 29th birthdays get to celebrate on their actual birthday. The Summer Olympics will be held in Paris this year, which will give everyone something to watch every night for two weeks starting in July. There will be a total solar eclipse on April 8th…these are always fun. I’m not sure if we’re all looking forward to this, but we do have a Presidential election this year as well.
I hope we can all find things to look forward to and to be grateful for in 2024. Despite our challenges, we have much to be grateful for. Sometimes Utah gets a bad rap, but the reality is, as the slogan goes…“we live in a pretty, great State”. In 2023, U.S. News & World Report put Utah in the top spot for the best state in America. Categories that go into this ranking include crime, economy, education, health care, infrastructure, natural environment, and opportunity. Utah has one of the strongest economies in the country and has for some time. Utah has a highly educated population, which plays a key role in the state’s strong economy.
Here at Wasatch Peaks, we are proud to have been part of our local communities in Northern Utah since 1930. In 2024, our 95th year of operation, we are still committed to the credit union slogan of “people helping people”. We are grateful for all of the individuals, families, and local businesses that make up our membership. Please let us know how we can help in 2024…remember, we’re all in this together.
