The Fed’s announcement yesterday produced two important pieces of news both of which point to a very favorable near term outlook for home buyers.
First, there will be no additional rate hikes in 2019 signaling that we have paced inflation and can expect, at least from the Fed, a more stable rate environment. Stability in our business is a very good thing. In and of itself this creates a reduction in rates. But that’s not the end of what we heard. Which leads me to the second piece of news. The Fed will end its run off on bonds and begin BUYING bonds again and from the sound of it in a very big way. This action would also, as a stand alone activity, serve to push rates lower. Taken in tandem rates overnight have dropped to 14 month lows and could dip even further. This is as big a change as anyone could have expected!
While the market will take a few weeks to make heads or tails of what this signals in the larger economy the signal to our buyers and borrowers should be clear...it’s time to buy and time to buy now! The monthly average savings on a $300,000 mortgage compared to November of last year would be almost $150. Existing homes, inventory homes or homes nearing completion are a great way to take advantage of the current rates!!
Please let us know how we can help both you and your customers take advantage of the best rates we’ve seen in quite some time.