As of this third week in February, thirty-year year fixed rate
mortgages are still holding at 5% - 5.125% for very well qualified
purchasers. FHA and VA loans are still tracking about the same.
The following is a recent commentary from Market Alert:
Commentary: "Treasury prices are rebounding
from a selloff yesterday following a fairly dismal $81 billion
three-part government debt auction that absorbed investors'
attention during the middle part of the week. Oftentimes when we go
through a period of heavy supply from the government - followed by
a coming week of bland economic news and no new debt auctions from
Uncle Sam - the overall market tends to breathe a little sigh of
relief. That's an environment that tends to be supportive of steady
to perhaps fractionally lower mortgage interest rates.
Earlier this morning China announced it will raise reserve
requirements for its banks by 50 basis points, a move to slow
growing inflation pressures within the country. The news sparked
fears among some stock traders that China's monetary policy could
wind up stifling global economic growth. As stock prices fell, the
safe-haven appeal of dollar-denominated assets like Treasury
obligations and mortgage-backed securities benefited as capital
flowed in waves from riskier asset classes."
What is not mentioned in this commentary is the current economic
disparity between countries. China is modifying its policy to
protect their currency from inflation and devaluation. As the
majority of the world is dealing with shrinking GDP numbers and
tremendous unemployment, China's economy will grow. The fact that
Greece is on the brink of total economic collapse might actually
help keep interest rates down at their current historically low
levels.
The Federal Reserve has stepped in and said it will continue buying
mortgage backed securities "as needed" to keep the United States'
recovery on track. This is a huge weight off our shoulders as the
March 31st scheduled end to this practice does not appear as
concrete as it was before.
Some information in this market
update was provided by Brent Ellwood, Regional Manager of PCR
Mortgage Services, who can be contacted at (410) 991-9595.
Branden Schroeder -- Associate Broker, LEED AP
Coldwell Banker Residential Brokerage -- Annapolis, MD
Please visit my Maryland Real Estate website or call (443) 333-9060
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