Wow, did my phone ring today! The Feds cut the interest rates a quick email from one of my primary lenders, Ken Hope, with First Horizon mortgage went like this: Fed Reserve Cuts Rates By .75%! (http://www.nbnnews.com/NBN/issues/2008-01-21/Coast%2Bto%2BCoast/index.html)That’s the big news this morning…really! If you’ve not watched the emergency move by the Fed this morning, that is.
According to Mortgage Market Guide, the rate cut was in response to foreign markets as they have felt a dive on fears of a US Recession. This move, was unexpected and one of the largest cuts since 1980.
So far, the Bond Market is responding very favorably with a 31bps increase on the FNMA 5.5% bond.
At this point the Dow is down 160 points and NASDAQ down 50. According to MarketWatch’s, Rex Nutting, the markets expect another rate cut by possibly 1/2 by the January 29th and 30th meeting by the Fed.
It’s great news for mortgage markets, interest rates, and the business we acquire from low rates, HOME SALES.
The next great news, came from the National Home Builders Association as I read an article about lumber prices coming down due to lack of demand.
My question is to those who are wondering should I buy or not? The rates are great, the supplies are coming down, and unlike the flurry of trying to keep up with demand a few years ago, with less housing starts, it would seem to me that attention to detail would increase due to the contractors not being pushed so hard to get to the next job.
It’s a great time to make a move. The impact of less housing start is a ripple that turns into a tidal wave for the number of American workers it affects.