INFOMORNATION THAT HITS US WHERE WE LIVE & BEYOND ...FOR THE CHRISTMAS WEEK
First, the good news, then the best news. The good news is that last week, for the first time since 2006, the Fed raised the Funds Rate. Yes, that's good news.
It means the nation's central bank thinks the economy is now growing well enough to withstand a rate hike. And that's good because the economy is the most important factor influencing home sales and prices: a growing economy means a healthy housing market.
It's also good the increase was just 25 basis points, a very small jump to 0.25%-0.50%. Freddie Mac's chief economist said, "We take the Fed at its word that monetary tightening [meaning rate hikes] in 2016 will be gradual."
Furthermore, interest rates for revolving credit, such as credit cards and home equity loans are tied to the Fed Funs Rate, but mortgage rates are not.
They're tied to bond yields, which is why every week we watch the 30 YR FNMA 4.0% bond. As its price goes up, its yield goes down, driving mortgage rates in the same direction.
Freddie Mac's economist feels, "Mortgage rates will tick higher but remain at historically low levels in 2016." That said, it's probably better for buyers and sellers to act sooner rather than later this year.
The best news? Housing Starts shot up 10.5% in November to a 1.173 million annual rate and Building Permits soared 11.0%, to a 1.289 million annual rate.
BUSINESS TIP OF THE WEEK...
This time of year, it's good to remember that The Golden Rule is just as important in business as in our personal lives. Treating others as we wish to be treated is key to success in every endeavor.
QUOTE OF THE WEEK...
"You only live once, but if you do it right, once is enough."
-Mae West, American actress, singer, playwright
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