Anna Child Group
May 10, 2013 – By Huntington Beach Realtor Anna Child – Source: DSnews.com
Home prices are well off the “bottom” as a result of a market which “over corrected downward” and mortgage rates which most believe are artificially low. But now, the rapid rise in prices has many industry experts wondering when the rapid upward rise will end and if prices will rise beyond the “market equilibrium” for “market mortgage rates”. It is generally accepted that when the Federal Reserve announces that it will stop buying $80 billion per month in mortgage backed securities, mortgage rates will take a “jump up”.
A real estate mortgage news website reported today that:
A majority of real estate experts responding to a recent Zillow survey expressed some concern that the Federal Reserve’s current policies could lead to another housing bubble… Only 4 percent of respondents are not at all worried about a bubble resulting from the Fed’s monetary policy that is keeping mortgage rates down. However, 48 percent see the Fed’s policies as “a little risky,” and the remaining 48 percent categorized the risk as “moderate to high risk.” According to Zillow chief economist, Stan Humphries: “How the Federal Reserve handles the eventual winding down of its policy of quantitative easing will be critical in determining if the current period of rapid appreciation is a benign bounce off the bottom or a more dangerous bubble being re-inflated.”
It is impossible to “time the market” perfectly. There is an opportunity window offered to home sellers today thanks to the current Federal Reserve policies. How long these policies will last is unknown, but certainly “now” is a great time to sell a home.