Jul 30, 2014

July 2014 Mortgage Interest Rates

- originally posted July 1, 2014 -

Interest rates dropped a tad lower during June with the 30-year FHA coming in around 3.875%. Rates continue to hover near the lowest levels we've seen in a year. It doesn't appear that rates will be pushed much lower though, because there just not enough stimulus to drive them down further. We've already seen signs of resistance in rising bond prices, which affects interest rates directly. 

The Federal Open Market Committee has continued to taper its mortgage bond purchases every month now since December, and with that continued level of tapering, the Fed may be out of the stimulus and quantitative easing business, by years end.

The direction and influence of interest rates is gradually being placed in the hands of market forces. The stock market is more and more looking bloated to investors, so while the Fed tapers, investors have begun to replace stocks with bonds. As long as bonds offer a safe haven from the increased risks of the stock market, we'll probably continue to see interest rates stable, and near current levels. It's unlikely that rates will be driven much lower though, without something dramatic happening, either in the financial markets, politically, or globally.

After the first week in July, we'll have more updates on jobs and unemployment numbers, which could cause interest rates to shift the other direction. Buyers should move to secure the current low rates, and take advantage of what the market has given. Lock, and don't risk it.

Till Next Month,

Michael Dagner

Michael Dagner is a real estate professional in Denver, Colorado.