First Time Home Buyers
Mortgage rates for most loans for first time home buyers improved on Tuesday following the release of the Fed minutes.
It’s a detailed, comprehensive recap of the March meeting. Comparatively, the post-meeting press release was about 450 words. The minutes are about 6,150. It’s almost 14 times as much information and certainly more influential.
Interest rates improved, but they could have easily taken a turn the other way.
Wall Street dissects these Fed statements and Tuesday was no exception. From the minutes, we see that the Fed is significantly less concerned about inflation. Inflation is bad for loan rates so that was one major reason for the rates rally after release.
This improves home affordability, among other things.
The Fed also touched on housing, noting that real estate sales may have been worse throughout the winter months if not for low mortgage rates and the sense among Americans that home prices were troughing.
Home prices are going to be interesting to watch in the near future. Higher rates will suppress home sales and rates will be higher, to some degree, in the future. Economic recovery also brings more buyers, especially first time home buyers. There will be an interesting balance between mortgage rates, home values, economic growth, and employment in the next few months.
If you’re looking for a bargain in the housing market, your window to act may be closing. It seems like rates, prices or both will be higher in the near future.
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