The Fed, mortgage rates and home prices | Metals Mine

  • The Fed, mortgage rates and home prices

    From berkshireeagle.com

    I recently spoke with a couple who want to sell their home. Their Realtor told them the market was a little soft but added that interest rates were likely to come down this year. The suggestion was that falling rates would boost home prices. That’s a common assumption, but it left me wondering whether it is always true. There are two key questions worth asking. First, do mortgage rates always go down when the Federal Reserve (“Fed”) cuts interest rates? And second, even if mortgage rates decline, should we expect home values to rise as a result? To explore this, I spoke with Eric Steuernagle, owner of ... (full story)

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