Info That Hits Us Where We Live – Saratoga Springs, NY – The Fed
QUOTE OF THE WEEK… “Society is always taken by surprise at any new example of common sense.” –Ralph Waldo Emerson, American essayist, lecturer and poet
INFO THAT HITS US WHERE WE LIVE… The Fed took the markets by surprise last week when it announced it would NOT begin tapering its Treasury and mortgage bond buying. But this was just common sense. Since May, the Fed’s been hinting it could start tapering bond purchases in September, which sent bond prices south and mortgage rates north. People then worried this might hurt housing, a bright spot in our slow overall recovery. So it makes perfect sense for the Fed to keep buying billions a month worth of bonds to, in their words, “maintain downward pressure on longer-term interest rates.”
This is all great for the real estate market, although its recovery hasn’t faltered just yet. Existing Home Sales in August hit their highest level in more than six years: a 5.48 million annual rate, up 13.2% from a year ago. Builders are on the bandwagon too. Single-family Housing Starts climbed 7% in August and are up 16.9% from a year ago. Single-family Building Permits reached a five-year high, and the home builders confidence index is at its best level in nearly 8 years. So if, thanks to the Fed, mortgage rates edge back down, things should really get interesting.
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