The scaling back of QE is expected to increase mortgage interest rates by 50 basis points over the course of the year. Some believe that the recent increase in rates pre-absorbed that anticipated impact.
However, to put it all in perspective, 2001 marked only the second time in Freddie Mac’s history (1971) that rates averaged below 7%. 2010 marked the first year that rates averaged below 5%. So by comparison, at 4.5%, today’s rates are still very cheap and it is a great time to buy!
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