Everyone at one time or another is concerned with mortgageg interest rates. Today and for the past 4-5 years we have been experiencing all time low rates or at least less than 5%. The FED, or Federal Reserve, has continued to purchase up to $85 Billion per month of mortgage backed bonds in the Secondary Mortgage Market to create a supply of money to allow mortgages to be available to you, Joe Public, and myself. This issuing of mortgage bonds has kept the borrowing limit very low and there has been some indication that it will not continue. However, given the delicate nature of the recovery from the Recession the low rates we have become accustomed to will remain for the immediate future. Here is a write up from Elliot Eisenberg a trusted economist on Real Estate on the tapering of the mortage back bond purchases and thus current interst rates:
Given the government closure and resulting lack of economic data, the fact that Q3 GDP growth will be below 2% and that inflation remains very tame, virtually guarantees that tapering will not commence following the conclusion of the late October Fed interest rate setting meeting. Now with the formal nomination of Janet Yellen for the post of Chairman, I’m 100% sure tapering will not commence before January.
Elliot F. Eisenberg, Ph.D.
Therefore you can rest assured interest rates will continue to remain at or near current levels through the remainder of 2013.
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