As I wrote in an earlier post, interest rates are very likely to creep up in the near future. According to the Associated Press, that has some home buyers in a panic
Says the AP: "With mortgage rates surging following the election win of Donald Trump, homebuyers may feel compelled to snap up loans before rates rocket even higher. But housing experts say consumers shouldn't get carried away by the post-election wave. The advance of the past week or so, stoked by a surprise victory that turned economic expectations on their head, could soon settle.
Says Erin Lantz, vice president of mortgages at Zillow, "Consumers considering buying or refinancing now should stay patient, as we'll likely see rates stabilize once markets find a new equilibrium."
The AP continues: "In the week ended Thursday, the average rate on the 30-year fixed-rate loan jumped to 3.94 percent from 3.57 percent the previous week, mortgage company Freddie Mac reported. That put the benchmark rate close to its year-ago level of 3.97 percent. The average for a 15-year mortgage, a popular choice for people who are refinancing, climbed to 3.14 percent from 2.88 percent.
"The rate rise was powered by a sustained decline in U.S. government bond prices in the days after Trump's victory became known early last Wednesday. Bond investors looked toward tax cuts and beefed-up spending to upgrade roads, bridges and airports under a Trump administration, which could fuel inflation. That would depress prices of long-term Treasury bonds because inflation would erode their value over time."
My opinion is not to be fearful, just aware of what is coming and make decisions accordingly. As always, there is more to come on this story . . .
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