At this time last year, our forecast called for interest rates for 30-year fixed-rate mortgages to exceed six percent by this time this year,
More Quotes from Frank Nothaft:
Release of the May Federal Open Market Committee (FOMC) minutes the week reinforced the notion that inflation in the economy in the first three months of the year was contained and upward price pressure in the near-term seems unlikely,Frank Nothaft
Although mortgage rates have risen in the last two weeks, they are still below last year's annual average of about 7 percent and well below 2000's average of 8 percent, ... The current rising rates will dull the edge of the refinancing market, but there remain homeowners who have put off refinancing for one reason or another who may now rush to their lender to take advantage of current rates.
Frank Nothaft
A shift in market perception about what action the Federal Reserve Board will take at its May meeting led to a downturn in interest rates this week. Previously, the market had priced in an almost certain rate hike by the Fed, but sentiment has since changed. Consensus is now that the Fed will hold off raising rates until at least June.
Frank Nothaft
There's about 6 trillion in single-family mortgage debt outstanding, and total home value is about 13 trillion, which means there's about 7 trillion in home equity outstanding. Last year was a big year for liquefying home equity -- about 100 billion. That's a drop in the bucket compared to 7 trillion.
Frank Nothaft
Growing evidence that the economic growth rate is throttling back to sustainable levels is the main reason why mortgage rates softened this past week.
Frank Nothaft
Recent downward revisions of GDP for 2001 and first quarter 2002 suggest that the economy faces weak growth. This led to anticipation that the Fed will reduce overnight interest rates by the end of the year, if not sooner. That expectation, in turn, has created a boon for potential and existing homeowners in the form of lower mortgage rates.
Frank Nothaft
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