What will happen with Interest Rates?
How does the result of the presidential election effect the rates now? There shouldn’t be an impact this fast?
There in fact is instant change. Mortgage Rates are set by investors based on Bond Markets and Securities. The changes in rates are often anticipatory to economic changes predicted. Right now it is uncertain how the economy will be effected with such great shift in power and leadership in the US. We have a new President that brings unknown change. Both House and Senate shift control to the Republican party. A Supreme Court that is guaranteed a new Conservative Judge and there are more Republican Governors in power making more Conservative State control. This doesn’t mean we have bleak economic future. We just have some uncertainty and adjustments to make as a country. It is believed that President Elect Trump has an interest in seeing the Federal Reserve raise the prime interest rates which will indirectly cause the mortgage rates to rise. It is unknown if that interest will be the same in December by the Fed Chair when the Fed meets again to have rate discussions. I see it unlikely that rates will increase drastically due to the bolster effect the housing market has on all of our markets. It would be hasty in my opinion to increase interest rates on buyers and homeowners. Keeping rates low keeps more buyers in the market. It allows higher purchase price range. It offers financial relief for homeowners that are in need of debt consolidation or interest reduction. Those cases will always exist. We shall wait and see. That is all we can do at this point.
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