Mortgage Rates

In 1935, Cret designed the Seal of the Board o...

Mortgage rates haven’t budged, remaining at historic lows throughout the year amid economic growth that has generated 2.5 million net new hobs over the past 12 months and a record high stock market. But uncertainty looms in light of Federal Reserve Chair Janet Yellen’s announcement that the economic stimulus program known as “quantitative easing” will halt by year’s end. Moreover, an increase in the short-term Fed funds rate is expected by the middle of 2015. The course of U.S. monetary policy, in short, will be less accommodating going forward

 

 

Job Growth

Leadenhall Building / May 2014 II

 

Higher mortgage rates will be “a headwind” for home buyers.

“Job growth continues to be strong in California and that means people feel more comfortable buying a home and mortgage credit has been very, very tight for the average person.

Job growth hasn’t been evenly distributed throughout the state, however. That means employment’s cushioning effect against the Fed taper will be felt differently in different housing markets.

Job growth has been especially strong in the technology sector, which benefits Northern California and certain pockets of Southern California.

As a result, the taper might be felt more intensely in those areas because they don’t have much job growth to offset its effects.