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Saturday, August 31, 2013

Rates are going even higher!

If you are a buyer on the sideline, news from the Federal Reserve should be motivation. Rates are going even higher!

Fixed mortgage rates reached new highs for the year after the Federal Reserve gave markets a sneak peek revealing a timeline for bond-buying tapering is in the works,according to Freddie Mac.
Fed. chairman Ben Bernanke put into action for tapering its asset purchases later this year if the economy continues to improve, potentially turning the housing upswing on its side.
Market analysts sounded the alarm Wednesday that one of the biggest risks to housing is the reduction of the central bank’s monetary stimulus, which would put additional upward pressure on interest rates and mortgage rates.
"Fixed mortgage rates continued to follow bond yields higher leading up to the August 21st release of the Federal Reserve monetary policy committee’s minutes for July.
In its July 30th and 31st meetings, the committee members were broadly comfortable with a plan to start reducing its bond purchases later this year” said Freddie Mac vice president and chief economist Frank Nothaft.
Homebuilder stocks also took a beating this week after the

FOMC minutes suggested the central bank will begin tapering its quantitative easing program sooner rather than later.

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