I know that economic and financial talk can turn most of our brains to mush in a matter of seconds. Most of the time mine feels like creamy potato soup so I'll try to make this short and sweet.
On February 2nd I sent out this as part of my Market Pro-Spective:
"Given the current economic status and all the other twenty something odd number of things that affect mortgage rates we should be at a true all time low. The reason we are not is because of the increase in bonds being issued by the U.S. Government to finance the stimulus package.
So, now the question to all refinance candidates is this: What has to happen for rates to drop? Demand for bonds has to increase or supply has to decrease? You are absolutely right! You get an A.
They key piece of information to look for is this : The Federal Reserve has said the government will buy a large soum of bonds before the summer (they did back in December and rates dropped). If those intentions are confirmed or they actually do buy a large chunk of bonds then we will see rates return to near historic lows yet again. If not then who knows."
Yesterday the Fed announced it would follow through on its plans to buy $300 Billion in treasuries and pledge to buy another $750 Billion by the end of the year.
This is what I was talking about. Read the headlines over the next few days and you will possibly see announcements of rates at an all time low. Just remember you heard it here first and by all means now is the time to purchase or refinance a home.