In view of realized and expected labor market conditions and inflation, the Fed Committee decided to raise the target range for the federal funds rate from 1.25 to 1.5 percent. It is also projected that the Fed Fund Rate will increase three more times in 2018. The Fed Fund Rate is the short-term rate that banks borrow from each other overnight. The Fed Fund Rate has an indirect correlation to Mortgage interest rates. This increase was expected and the market had already priced in the increase over the past 30 days.
What does this mean to home buyers? The average mortgage interest rate over the last 45 years is 8.26%. Rates are still historically low but according to projections, we could see a significant increase over the next 12 months. It’s a great time to purchase right now with lower interest rates, good inventory and before the Spring or Summer “storm”.
If you are looking to sell or purchase real estate in Dallas Metro, I'm honored to have the opportunity to assist you.
*Information provided by Linda Davidson at Service First Mortgage with permission to blog.
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