Fed ends QE3 and sends upbeat signals on economy – Market Watch
Fed Stimulus Over: What About Interest Rates? – Nation Association of Realtors
The Federal Reserve has ended its bond-purchasing program, known as “quantitative easing,” saying it is confident in the economic recovery.
Since 2008, the Fed has been purchasing mortgages and Treasurys that have helped bring interest rates down to historic lows, but it has been tapering its monthly $10 billion program since December 2013. The central bank plans to hold onto the $4.48 trillion in bonds it has accumulated in purchases since November 2008. For now, the move is expected to keep borrowing costs low for “considerable time,” the Fed said.
The Fed’s key short-term interest rate has remained low since December 2008, and it has yet to be announced when the rate will begin to rise again. But Capital Economics analysts predict that the Fed will start raising rates in March 2015.
“We’ll live just fine without QE [quantitative easing],” former U.S. Treasury Secretary Lawrence Summers told Bloomberg Television’s “Market Makers.” “Interest rates at the 10-year are now much lower, not much higher, than they were before QE started.”
How Many Showings Until You Find ‘the One’? – NAR and BMO Harris Bank
House hunters will visit an average of 10 homes before finding the perfect match, according to a survey of about 2,500 Americans by BMO Harris Bank. For about 51 percent of buyers, it’ll take up to six months of searching before they find the home they want.
However, that time could be shortened: 77 percent of buyers, or about three quarters, say they’ll know immediately when they’ve found their ideal house.
Slightly more than half of home buyers are confident that their search will pay off in the end, with 52 percent saying they believe they’ll find their dream home in their price range. However, 48 percent say that is impossible, and the majority of buyers realize they may have to settle for something less than perfect.
Home buyers surveyed describe a range of mixed feelings when house hunting. Here are their top six emotions:
- Excited: 44% (all home buyers); 47% (first-time buyers)
- Hopeful: 33% (all home buyers); 43% (first-time buyers)
- Cautious: 32% (all home buyers); 26% (first-time buyers)
- Optimistic: 28% (all home buyers); 26% (first-time buyers)
- Happy: 26% (all home buyers); 37% (first-time buyers)
- Anxious: 25% (all home buyers); 31% (first-time buyers)
They say their top concerns in the home-buying process are:
- They’ll find something wrong with the house after they move in: 79%
- Housing prices will drop after they purchase: 69%
- Not being able to afford the mortgage: 61%
Some of the stress in the home-buying process can be relieved by getting pre-approved for a mortgage, the survey found. Ninety-eight percent of first-time home buyers say they believe the pre-approval process would take the worry of financing out of shopping for a home. However, only 13 percent of first-time buyers surveyed say they’re currently pre-approved for a mortgage.
“Pre-qualification is something we encourage house hunters to do before looking for a new home,” says Kevin Christopher, head of mortgage sales at BMO Harris Bank. “It makes it easier to put in a serious offer when the time comes.”
Picture property of Place Architect Ltd., as seen in the PSBJ.