You’ll hear people talk about the data behind interest rates and their recent rate increases..I don’t wanna bore you with that. I’m going to talk about the emotion behind the increase and why the government isn’t likely to do anything quickly soon to help the current home buyer who’s under contract or the homeowner hoping to lock in at close to all time low rates.
The problem is that what they did is working. They used quantitative easing to help spur the purchase market through the summer and the housing market “seems” to be in recovery. The people who were buying a house at 3.25% will most likely still buy at 4.25%..so there isn’t much lost there.
The truth is they are probably right..and until we head towards the fall and buyers start to hibernate everything seems to be in good shape. That’s why I think although rates may go down and we will get back some of what we lost over the past couple of weeks..if you ever see rates back in the 3% range it won’t be until after summer sales slow.
Additionally, do not be surprised if both Fannie Mae and Freddie Mac extend the HARP date to all loans before June 1st 2010 and FHA follows suit with streamline programs getting the date extended too.
- Mortgage rate hikes draw concerns for housing market (bizjournals.com)