Mortgage rate predictions for 2014 and 2015
The short story is, the time to buy and to sell is now. The Feds have started the “tapering off” process of the economic stimulus plan of purchasing $85 billion in bonds each month. Bonds are directly tied to interest rates. Less demand for bonds (and the Feds are clearly the largest purchaser,) will lower prices and interest rates will rise. The Feds will end the program of bond buying for ES entirely in October 2014.
Interest rates today at 4.25 for a 30 year fixed. Still amazing low rates. Rates should go up at least a point by the end of the year and another 2.5 points by the end of 2015.
A borrower today with a million dollar mortgage will have a monthly payment of $5961, by the end of the year it will go up to $6563 and by 2015 up to $7527.
Buyers are going to have to buy a less expensive home and values will decline.
If you are thinking of listing your home or are thinking of buying a home, please give me a call or send an email to Rebecca@VistaSIR.com and I’ll be happy to assist.
Here is a great article explaining a bit more.