Every time I turn on the TV, I hear the doom and gloom of the housing crisis and the mortgage mess. Yes, we are in it. But what I have been hearing is how long the "pundits" are saying we will be in it. Into the later part of 2009 ? Into 2010 ? 2011 ?????
Maybe so, if oil were to go to $170 a barrel and with high inflation, mortgage rates would go into the mid 7s. The FED would be forced to raise rates. I was a bit worried myself that rates would climb over 7 percent with the increase in the price of oil and other commodities over the last couple of months
But how nicely things have changed with the collapse in oil and commodity prices !!! And is anyone talking about it ? Not yet !! Here is the scenario: If oil keeps on its downtrend and other commodities such as gold and copper continue downward, the FED will have the opportunity to LOWER rates after the election. The only talk has been the possibility of a rate hike, but no one is talking about this option as of yet. Excuse me... two people... Bill Gross, the bond king from PIMCO, mentioned that possibility on CNBC the other day and Chris Somers with RE/MAX Affiliates in Philadelphia : ) On a side note, did anyone catch Bob Toll's update with Toll Brothers this past week ? If not, I would recommend it.
Here is a good possibility now - with mortgage rates potentially staying firm in the mid 6s and ranging between low 6s and up to 7 percent on volatility, in addition to the housing bill and tax credit and the election, the housing market could be prime for a rebound in mid 2009 or the second half of 2009 at the latest ! No one is talking about the pent-up demand that is out there, but it is there and growing ! All the media pundits are stuck on the doom and gloom prognosis as that is what sells !!!
What does all this mean ? Buy a house now !!!! Or from an investment standpoint, buy some financial stocks, investment banks or some homebuilders ! Or as a realtor, grow your web presence now and fast : )