Today the Case Shiller Index reported home prices fell more than twice as fast as expected in September than they did in August. I know many of my clients gasp when I tell them what their home appraised for, but it would appear prices may be going lower still.
On top of home values going down interest rates have gone up about .25% over the past few weeks and seem to be poised to go higher still. For many home buyers the rise in interest rates will negate the savings from a lower sale price, but that seems to be lost in the media's reporting.
Rates fell below the 200-day moving average (MA) back on November 15th and once below this key mark its going to be tough to see rates go lower again. The FNMA 3.5% bond shows that bond traders have tried to rally back above this 200-day MA three times over the past two weeks and turned lower each time. (bond prices going higher means rates go lower and vise versa).
I have been surprised rates have managed to stay as low as they are as long as they have. If you are looking to purchase a home or have been waiting to refinance because you expected rates to go lower...you may want to reevaluate your plan and get moving sooner than later to capture these low rates.
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