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Right interest rates treasury rates are dropping -- slightly is that lot of concern about the US economy but interesting and a trend of the last couple of weeks mortgage rates on the rise.
Up again for again a fourth consecutive week the national average thirty year fixed rate.
Freddie Mac is it three point 66%.
Joining us today with more on these rising rates and how will impact the housing -- -- I can tell the American Enterprise Institute he's a resident fellow there -- great to have you back on the show.
Thank you -- pleasure.
What thoughts on why interest rates are rising inching up you know just a little bit here but against the backdrop of a lot of people concerned US.
Economy might be headed back toward recession at least if you listen to CBO and whether or not we can work out this fiscal -- Right and interest rate mortgage interest rates bounce around a lot and I wouldn't be too concerned about.
Changes of a quarter and a -- even 1%.
-- during my career -- which is almost forty years now.
I started out interest rates or 9% while they went -- peaked at seventeen.
You know they came back down to 98765.
Now there -- three and a half.
They bounce around a lot -- why -- against that within that correlated take bounce around a lot.
Their -- related primarily to treasury rates.
And treasury rates have moved a lot over the years they continue to move but moves a quarter a half are very commonplace just like.
Moves in the stock market of twenty points thirty point get -- points -- commonplace.
It's gotta be real tough then to predict where mortgage rates are headed so.
Do you then advise homeowners not to try and you're you're kind of shaking your head game a bottom for mortgage rates.
Absolutely they should just looked as the rate work for me today.
There's -- house look like it's price right today.
And if it is and I can afford it go for it don't try to pick a bottom even if -- in a refinance environment don't try to pick a bottom.
If the refinance looks like it it works go -- -- because rates could go up but when rates do go up in a big move they -- -- pretty quickly as if they're gonna move.
A hundred to 200 points that usually happens pretty over relatively short period time -- -- gets very hard to.
To -- lot that in.
Died trying to get the last 25 basis points is not a wise move.
Still to your point again rates historically low this time last year the thirty year fixed was four point 22%.
So what do you think is the best course of action for homeowners because -- break even other inching up ever so slightly.
Yet they're still going up.
So do you think that this could be a catalyst to encourage homeowners who might be if -- whether or not to jump been.
To jump in now do you think that we'll get a a bit of a push to the positive to revive the housing market.
I I think you'll see on the purchase market a bit of a push to get in.
But on the refi market actually works some extent the opposite and because is the rates go up then refinance opportunity the window.
Gets smaller and so those that goes down but the real healthy -- this market nerd and a get the market going is the purchase market.
And that's what I tend to focus on.
And so I think people.
Would be is more likely to jump in now if they see.
Rates going up a bit because you don't know what's gonna happen now for 58 months from now.
And what's your take on the housing market you agree with the growing course of people who think that.
We've hit bottom and it's it's reviving.
I think we generally hit bottom and I base that on looking at fundamentals.
What rents are doing.
What construction costs are doing relative to sales prices he comes -- to the -- prices and all of those signal.
That we've pretty much I've gotten back good to were even some cases beyond.
The -- we reverted to the mean.
And that's very important that that happen.
And efforts of the last couple years to stop that from happening -- really slow down recovery but now we have senator belts and and I think we will have recovered from here.
Unless something untoward happens which could be the fiscal cliff it could be Europe but if if our economy continues growing.
Even at the relatively -- it's been growing that I think we're at bottom end and we'll recover.
Sure hope here at crystal balls correct there Ed kids -- -- black.
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