You probably have a sense of this already, just by keeping your ears open and applying common sense, but I thought I'd post this article for you:
"RATES IMPROVE SLIGHTLY THIS WEEK!
"The recent unrest in the Middle East is causing investors around the world to move money to the safe‐haven of US bonds, causing bond prices to increase, and resulting in lower mortgage rates. While we’ve seen slight improvements in the mortgage rates this week, they haven’t dropped nearly as much as many analysts expected. This is especially surprising when you consider the stock market dropped 325 points in addition to the bond market increases. However, many experts are warning that the recent gains in bonds will be limited by fears of inflation down the road. Therefore, the improvements in rates are likely to be temporary and may not last for long. In addition, as the economy continues to expand, albeit slowly, rates will move higher over time.
"Many are predicting mortgage rates to be around 5.5% toward the end of 2011. This week’s small downturn in rates provides an excellent opportunity to lock in your rate before they go back up. For those who are waiting to see if housing prices drop further, you should know this fact: a 5% drop in the price of a $400,000 home is completely offset by a 1% increase in interest rates. Now is the time to buy…housing prices are great and rates are still low!"
Sunday, February 27, 2011
Saturday, February 5, 2011
UNEMPLOYMENT FIGURES CAUSE INTEREST RATES TO RISE
Interesting analysis from WendyC@LoanCentral.com:
Unemployment figures were released today and contained some mixed information. The unemployment rate fell from 9.4% to 9%, shocking many analysts who had expected it to rise slightly. Many experts are scratching their heads trying to figure out how we got to this number. The drop to 9% indicates that 504,000 people from the previous month are no longer unemployed. It’s a good bet that these folks didn’t find a job, but instead have left the labor force because they can’t find a job, or are discouraged.
Signs of economic recovery cause mortgage rates to rise. The markets were very volatile today and interest rates are up on the day. Further interest rate increases are expected with many analysts predicting rates will be around 5.5% by year end, which results in a loss of buying power of approximately $30,000 on a $400,000 sale price.
As of this moment, the Fed Fund Futures, which forecast when the Fed will hike interest rates, has moved from a Monday reading of a 52% chance that they will hike in January 2012…to today’s reading of a 100% chance of a Fed hike at that meeting.
Don’t miss out on these historically low interest rates…now is the time to lock your rate under 5%!
Unemployment figures were released today and contained some mixed information. The unemployment rate fell from 9.4% to 9%, shocking many analysts who had expected it to rise slightly. Many experts are scratching their heads trying to figure out how we got to this number. The drop to 9% indicates that 504,000 people from the previous month are no longer unemployed. It’s a good bet that these folks didn’t find a job, but instead have left the labor force because they can’t find a job, or are discouraged.
Signs of economic recovery cause mortgage rates to rise. The markets were very volatile today and interest rates are up on the day. Further interest rate increases are expected with many analysts predicting rates will be around 5.5% by year end, which results in a loss of buying power of approximately $30,000 on a $400,000 sale price.
As of this moment, the Fed Fund Futures, which forecast when the Fed will hike interest rates, has moved from a Monday reading of a 52% chance that they will hike in January 2012…to today’s reading of a 100% chance of a Fed hike at that meeting.
Don’t miss out on these historically low interest rates…now is the time to lock your rate under 5%!
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