Economists Say Rate Hike To Have Little Effect On 2017 Housing

Dated: December 16 2016

Views: 330

Now that the Federal Open Market Committee has voted to raise the target range for the federal funds rate from 0.5% to 0.75%, HousingWire staffer Kelsey Ramirez explores how it will effect first-time home buyers?


Rising rates combined with rising home prices could discourage homeowners from upgrading to a larger home, which would leave little inventory for first-time buyers.


But many economists say that isn't likely, according to Ramirez, as the increase is not enough to cause a significant impact on housing demand. Those economists remain positive about 2017’s housing market.


“The era of ultra-low interest rates is over,” said Lawrence Yun, National Association of Realtors chief economist. “Today’s short-term rate hike will be followed by several additional rounds of increases in 2017 and 2018.”


“Despite these moves, mortgage rates will not rise alarmingly,” Yun said. “By this time next year, expect the 30-year fixed rate to likely be in the 4.5% to 5% range.”


Image title


By Builderonline.com

Blog author image

Mark Ross

For Mark Ross, founder of Ross NW Real Estate and professional real estate broker, real estate has always been the career of choice. During his 30 years in the industry, Mark has gained experience in ....

Latest Blog Posts

10 Ways To Save On A Kitchen Remodel

A kitchen remodel is among the most popular renovation projects for homeowners, but it can quickly become the most expensive. According to HomeAdvisor, the average kitchen remodel costs $25,656, or

Read More

6 Mortgage Tips For Single Homebuyers With Children

If you’re a single parent, it’s arguably more challenging to buy a home than for those in a partnership with dual incomes. Yet it’s easy to see why so many single parents are eager to purchase

Read More

How To Deal With Unsolicited Offers

If you’re one of those lucky people who own a home in a “hot” area, it’s a pretty sweet feeling. You made a good real estate call. If you decide to sell, all signs point to it being an easy

Read More

Homebuying And Mortgage Guide For Singles

Many people might picture homeownership as an event that happens only after two people get married and start a financial partnership. Some mortgages are still structured to reflect that idea. But

Read More