Rate Watch – Where Do We Go From Here?

I’ve decided that I’m not getting into the rate prediction game. I made a lot of noise with my associates this weekend about what I thought – and guess what they told more people and all of a sudden I had calls from Portland, Oregon with friends of friends asking where I thought rates were headed. That is not good. I mean it’s good that they know I’m in the business, but there are too many uncertainities out there for me to exactly tell someone whether or not they should lock today or wait. I’m just not going to get into that game anymore.

With that in mind, we have some interesting things to report. Reports released today indicate that housing starts fell 17.6 percent in March 2005, to an annual rate of 1.837 million units. That was the biggest decline since January 1991 and economists had expected a drop of more like 6.6 percent. This is an unpleasant surprise and one would expect it to cause mortgage rates to fall. Rates did fall, but only slightly.

What About Inflation

Core inflation is up too, but if you exclude food and fuel then it’s down slightly. This will have a moderate to modest impact on rates since rising fuel costs have been widely reported, and is not news to anyone. The fact that the core-core rates fell (excluding fuel and fuel), means you can expect rates to stay stable for a while.

Today’s Parting Thought

I’ve been extra extra busy lately, which is a good thing. I enjoy the rigours of mortgage analysis and am glad to have this opportunity in life. As always don’t hesitate to write to me. I’m busy, but I always have time for my readers.

Remember to visit www.aimeeloans.com for all your home financing needs!

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