Follow Patrick Linkedin Facebook
Email Patrick Email
Financial
Mar 20, 2015

Interest Rates Plunge, Markets Soar After Fed Comments

Sponsored Content provided by Patrick Stoy - Mortgage Consultant/Owner, Market Consulting Mortgage

A recent press release from the Federal Open Market Committee sent mortgage interest rates on a nosedive and the stock market into one of the biggest climbs in weeks. In short, it was a cheerful moment for investors and buyers of real estate, even though big-shot bond traders worried the sky might be falling.

As usual the press release was filled with economic jargon and a lot of overblown, obscure language that would require interpretation from an academic holed away in an ivory tower to be fully understandable. Luckily I have become accustomed to reading updates from the Fed as I’ve worked in the mortgage industry for the past 16 years, and I have been fortunate to develop a network of colleagues.

My colleagues and I share a common goal of providing our clients with the best possible service, which occasionally means helping each other decipher press releases from the Fed. Here are the important points to remember from its latest, in plain language:

  • The Fed likes that employment levels have improved, but it worries about how things are going in the housing sector. People just aren’t building new homes as fast as the Fed would like.
  • The Fed has rising prices and inflation on its wish list. It is worried that, since prices aren’t rising, people will put off buying stuff because they think it might not cost them as much in the future – or at the very least it won’t end up costing them a lot more.
  • The Fed is unlikely to move short-term interest rates higher at its meeting in April. The big concern prior to the issuance of this press release was that the Fed would remove the word ‘patient’ from its communications. Guess what? The Fed did remove it and the world promptly came to an end, for bond traders anyway. Everyone else had cause for celebration, especially buyers of real estate.
  • The Fed is essentially saying that, “We are not quite sure when we will raise short-term interest rates, but don’t worry, when we do decide to move the rates, we promise not to go nuts and we will do so in a calm, stable manner, so don’t freak out, OK?”  
To summarize, the news from the Federal Reserve was extremely positive for anyone who is in the market for his or her first home or who might be considering purchasing a larger one. Interest rates are still hovering near all-time lows and it appears that will continue, at least in the short-term. Of course, anyone shopping for a home should meet with a qualified mortgage broker before starting a home search to minimize inefficiencies and begin the process in the most informed, educated way possible.

For a free assessment about your buying power and current financial position, with no obligation whatsoever, contact me at the number below. It would be my pleasure to help you chart a path to the realization of your financial goals.

Patrick Stoy has 16 years of mortgage lending experience. Patrick is CEO of Wilmington-based Market Consulting Mortgage, which he started in 2005 with a mission to build lifelong customer relationships by providing real value. To learn more about Marketing Consulting Mortgage, visit www.macmtg.com. Patrick can be reached at [email protected] or 910-509-7105.

Other Posts from Patrick Stoy

Mcm 14jan insight
Ico insights

INSIGHTS

SPONSORS' CONTENT
Burrus rob headshot 300x300

Real Estate Markets Yesterday and Today

Robert Burrus - Cameron School of Business - UNC-Wilmington
Screenshot2022 01 06at338 162234623

Food is the Foundation for Prosperous Communities

Girard Newkirk - Genesis Block
Untitleddesign12

Supporting Early Career Mental Health: A Guide for Employers

In The Current Issue

Retail Staples Recount Resiliency

Downtown Wilmington's central business district (CBD) continues to evolve, with new and longtime retailers making up a big portion of its fa...


A Shiny 2025 For Luxe Sales?

“In 2025, we anticipate continued growth in both the number of luxury homes sold and their pricing, driven by sustained demand from high-ne...


Groups Share This Year’s To-do Lists

For the Book on Business, the Business Journal asks several of the region’s economic development groups and organizations for a recap of wha...

Book On Business

The 2024 WilmingtonBiz: Book on Business is an annual publication showcasing the Wilmington region as a center of business.

Order Your Copy Today!


Galleries

Videos

2024 Power Breakfast: The Next Season