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Fed hikes rates again, plans to get up to 2.5% or higher by 2020.
Posted on 6/18/18 at 11:31 am
Posted on 6/18/18 at 11:31 am
My main point here is to point to mortgage rates and how they’re affected by the fed rate, and oh by the way, how we’re cruising for a housing crisis that’s going to have unpredictable effects (mostly very bad).
Where I was told just a few months ago that 9% interest rates won’t happen anytime soon
Back in March (and last year as well) I sounded the alarm that interest rates are going to cook the whole market in the next few years. People have been buying houses at basement rates, driving up sticker prices.
Well things continue to progress.
Since January, we have gone from a national avg of 3.95 to 4.62 and it’s going to continue to rise and higher and higher rates.
LINK
The fed isn’t going to be able to control inflation at just their 2.5% interest rate. Yes that’s an opinion but I think it’s a good one. QE is going to bite us in the arse sooner or later and with the unemployment low and economy booming, we’re going to have inflation problems here pretty quick.
9%. It’s coming.
Where I was told just a few months ago that 9% interest rates won’t happen anytime soon
Back in March (and last year as well) I sounded the alarm that interest rates are going to cook the whole market in the next few years. People have been buying houses at basement rates, driving up sticker prices.
Well things continue to progress.
Since January, we have gone from a national avg of 3.95 to 4.62 and it’s going to continue to rise and higher and higher rates.
LINK
The fed isn’t going to be able to control inflation at just their 2.5% interest rate. Yes that’s an opinion but I think it’s a good one. QE is going to bite us in the arse sooner or later and with the unemployment low and economy booming, we’re going to have inflation problems here pretty quick.
9%. It’s coming.
14
Posted on 6/18/18 at 11:33 am to cokebottleag
Woodrow Wilson is burning in hell for creating that monstrosity.
Posted on 6/18/18 at 11:33 am to cokebottleag
Solution?
Posted on 6/18/18 at 11:35 am to cokebottleag
Waiting on LSURussian to rush to the defense of the Fed.
Posted on 6/18/18 at 11:39 am to cokebottleag
Rates pricked the bubble in 2000 and 07. You are right they will prick it again.
Posted on 6/18/18 at 11:41 am to brian_wilson
quote:the 2000 recession was incredibly mild....probably most mild in american history.
Rates pricked the bubble in 2000
Posted on 6/18/18 at 11:43 am to cokebottleag
quote:
we have gone from a national avg of 3.95 to 4.62
When I refinanced back in '99 my rate was 7.75 for a conventional home loan. Be happy. There's still a long way to go yet.
Posted on 6/18/18 at 11:43 am to SmackoverHawg
No solution that I’m aware of. Just ride it out and don’t buy a house if you’re planning to sell in the next 5 years.
We’ve had too long of a period of 0% interest.
We’ve had too long of a period of 0% interest.
Posted on 6/18/18 at 11:48 am to cokebottleag
quote:
No solution that I’m aware of. Just ride it out and don’t buy a house if you’re planning to sell in the next 5 years. We’ve had too long of a period of 0% interest.
Agree.
At least we're seeing economic growth with it. Hopefully, it'll stay reigned in, but honestly I'm fine with them going up. Will get better return on money I have to keep in interest bearing accounts and I don't plan on needing financing or selling anything soon.
Posted on 6/18/18 at 11:48 am to cokebottleag
I’m sure when it hits we’ll hear a ton of blame for the economy finally taking off and not for the 8 years we were printing money like Weimar Germany to pretend things were hunky dory.
Posted on 6/18/18 at 11:48 am to Homesick Tiger
quote:
When I refinanced back in '99 my rate was 7.75 for a conventional home loan. Be happy. There's still a long way to go yet.
How good will 5% look if we spike to 7.75-8% in a couple years?
Posted on 6/18/18 at 11:48 am to Homesick Tiger
Not the point.
Was that 7% refinance on a $221,000 house? Because that’s the median price today. In 99 it was only $165,000.
LINK
Was that 7% refinance on a $221,000 house? Because that’s the median price today. In 99 it was only $165,000.
LINK
Posted on 6/18/18 at 11:50 am to cokebottleag
Upgrading houses when I did is looking to be a smart move on multiple fronts.
Locked in a low interest rate and I’m in the process of getting the equity out of the old house before the market craters.
Locked in a low interest rate and I’m in the process of getting the equity out of the old house before the market craters.
Posted on 6/18/18 at 11:52 am to cokebottleag
quote:That’s like a 1.7% yearly increase.
Was that 7% refinance on a $221,000 house? Because that’s the median price today. In 99 it was only $165,000.
Posted on 6/18/18 at 11:54 am to HailHailtoMichigan!
quote:
the 2000 recession was incredibly mild....probably most mild in american history.
Rates still pricked the bubble, in this case it was the stock market bubble. We had a stock market collapse.
9/11 obviously had a major impact on it.
Here is to hoping that we get a mild recession like 00/01 and not a big one when the recession hits. Especially since we really didn't get robust economic growth.
Posted on 6/18/18 at 11:55 am to ItNeverRains
quote:
if
It's hard to respond directly to a question with the word "if" in it for me. As I said, it was a conventional loan which more times than not is a cheaper rate. I have no idea what the FHA rate was at the time.
Posted on 6/18/18 at 11:56 am to cokebottleag
Credit has been dirt cheap. This wasn't always the case and surely will rise in the near future.
Mortgage rates reached 18% in 1981.
Mortgage rates reached 18% in 1981.
Posted on 6/18/18 at 11:58 am to RogerTheShrubber
Combine LBJ “Great Society” programs with Nixon economics and Carter foreign and energy policy and you too can have stagflation.
Posted on 6/18/18 at 11:58 am to cokebottleag
quote:
how we’re cruising for a housing crisis that’s going to have unpredictable effects (mostly very bad).
Would love to hear your reasons for this a
quote:
9%. It’s coming.
9% what is coming?
Posted on 6/18/18 at 11:59 am to teke184
quote:
I’m sure when it hits we’ll hear a ton of blame for the economy finally taking off and not for the 8 years we were printing money like Weimar Germany to pretend things were hunky dory.
This. You can't pump that kind of money into the system and their not be a reckoning at some point. I'm not an economist, but it seems as if we are once again on a bubble, albeit not as large, I'm hoping Trump's economic policies and tax cuts will help strengthen the economy gradually and replace all that printed money with a solid economic base.
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