Mortgage Rates continue to rise – is this the peak for now?
As expected, mortgage rates increased again this week, reaching 4.3%, a level not seen since….as recently as April, 2014.
The sharp jump in rates since the Election has been based upon expectations that the new Congress will pass measures to stimulate economic growth. The stock market, bond market and mortgage market are all assuming that such measures will be passed and will lead to faster growth, meaning that there will be less pressure on the Federal Reserve to use monetary policy to try to drive the economy forward.
While it is tempting to be a contrarian and suggest that the markets are not allowing for the possibility that 2017 may not turn out as hoped for, I think a more realistic assessment is provided by HSH.com:”absent any truly awful economic news and prospects for worsening conditions (whether here or abroad) we are not likely to see rates below the 4 percent market anytime soon, and perhaps not until the next economic downcycle occurs.”
Mortgage rates may pause here for a while, but it seems likely that they will end 2017 higher than they will start the year.
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If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated