As you may know, the fed has been buying mortgage backed securities to keep rates low to stimulate a housing market recovery. With the depth of that recovery debatable, is now a good time for the fed to pull out?
The simple answer is yes. The fed currently has about $89 billion left to spend from its original $1.25 trillion. This would allow the fed to purchase close to $2 billion a day in mortgage backed securities through the end of Q1 2010. This figure is lower than the $3 billion a day in purchases made in mid January but should be sufficient due to the seasonal adjustment in mortgages produced. This purchase amount should keep rates near historic lows throughout the Q1.
At the end of Q1, rates will start to increase but that should coincide perfectly with the increased demand of new home purchase requests which typically happens in Q2. The fed will then be allowed to exit just as demand rises which should keep pricing stable. The stability of price coupled with the exit of fed intervention should then lead to more confidence in the housing market overall.
For more details NEWS!!! Mortgage News Daily.
Opinion by Paul Nelson
Source Mortgage News Daily
Grab Marathon's RSS Feed
News
- Moving With Children Advice
- Moving To A New Residence that’s not ready—What to do with your treasured possessions?
- Quality Protection For All Your Moving Needs
- Boston Movers! Not Just Any Box Will Do!
- Safety Advice For All You Movers Out There
- Thinking About Moving? Let Marathon Help You With Some Tips
- Making moving easier
- Moving is not all we do
- Beware of The “Car Salesman” Approach to Contracted Moves
- We Are Proud To Be Your Trusted Consultant
- Hold Off On Disposing Your Moving Boxes and Paper
- Moving Pool Tables and Pianos
- Packing Tips for Children and Pets
- Moving From Low To High Altitude Can Be Dangerous
- Color Coordinate For A Smooth Move
- Making Your Move To Mexico is Muey Bien
- Renovating? We Offer Temperature-Controlled Short and Long-Term Storage
- Boston Movers! If You’re Moving Internationally, Take Special Precautions
- Boston Movers! Take Special Care Packing Pictures, Records, and DVDs
- Boston Movers! June and July Movers Should Be Selecting Their Moving Company Now
