Bonds and Intrest Rates - Market flexing in Buyers favor!

There were changes in the news about Bonds and home loan rates last week - but not necessarily all in the "right direction". For most of the week, Bond prices moved lower, causing home loan rates to rise - home loan rates worsened by about .25% for the week overall.
One silver lining...some of the abuse that Bonds took was at the hands of somewhat positive economic news. Remember that positive or strong economic news tends to benefit Stocks, which in turn can pull money out of Bonds - which causes Bond prices to worsen and home loan rates to rise. So when news hit of a far better than forecast Retail Sales Report and much better than expected earnings reports from giants like Google, the financial markets responded by flowing money over into Stocks, and right out of Bonds, causing home loan rates to rise.
Also hurting Bonds was inflation chatter during speeches made by several Federal Reserve Presidents, who voiced concerns of inflation possibilities. Add record high oil prices and a seventeen-year high on food prices. Because inflation erodes the value of the fixed return provided by a Bond, the scent of inflation in the air always causes Bond prices to decline, and as a result, home loan rates will rise.
Even though the market is flexing, it is still a good time to take advantage of historically lower loan rates before rising inflation continues to push rates higher. Buyers now have much more negotiation power in the market. So now may be a good window of opportunity for you.
If you, or a friend, family member, neighbor or coworker needs advice on buying property before the next changes price you out of the market, please feel free to get in touch.

Keith
310-391-0821