The biggest news in real estate just hit the stands as Mortgage rates have come to a nine week low over the past few week. We can attribute this drop due to the Fed's bond buying program still going in tact to help the Monroe real estate market increase during this recovery.
The national average for a 30-year fixed mortgage loan has dramatically decreased .18 percentage point this week, shown from the most recent buying survey from Freddie Mac. The mortgage rates have made a sudden turn for the downward slope as the height of the rate, 4.57% has now decreased to 4.32% over the course of a two week period. This is still though a little less than a whole point higher than what it previously was this last year at the exact same time of 3.40%.
Before this previous week, the mortgage rate was holding steady at a 5 week trend of at or above 4.50%. On August 22nd though, rates hit a two year high when they climbed all the way up to 4.58%, a concerning notion for most Monroe commercial real estate buyers as this may have priced them out of certain properties.
“Mortgage rates fell following the Federal Reserve announcement that it will maintain its bond buying stimulus,” stated Freddie Mac's chief economist Frank Northaft. Although, Mr. Northaft acknowledged that the fall benefits Monroe commercial real estate buyers: “These low rates should somewhat offset the commercial real estate price gains seen the last number of months and keep property affordability elevated.”
Previously in July, Mortgage rates took a turn for the upper to mid 4 percentile as it was stated that the Federal Government may be coming to an end with the Bond Buying process, which in turn keeps rates low for the benefit of Monroe real estate buyers and sellers. Recently though, it was noted that the Government would not take down their program until employment rates rose to an unknown spot.
In the upcoming future, 70 percent of real estate analysts polled in Bankrate.com’s latest Mortgage Rate Trend Index agreed that Mortgage Rates will go down this upcoming week as well. “Mortgage rates dropped after the Federal Reserve surprised markets with news that they would not start the tapering of their bond purchases. I expect that trend to continue and to be supported by concerns about the debt ceiling debate and the possibility of a government shutdown,” stated Michael Becker of WCS Funding Group. He then went on to tell commercial real estate investors to take advantage of this quite possibly temporary dip: “While I expect rates to be lower in the coming week, I don’t expect this dip in rates to last long. So don’t become complacent, and act now if you can.”
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