The Ides of March was the 74th day in the Roman calendar, corresponding to the 15th of March. It was marked by several religious observances and was notable for the Romans as a deadline for settling debts. The meaning changed on March 15, 44 BC, when Julius Caesar was assassinated and a turning point in Roman history. It is now considered somewhat of a bad omen.
The March Fed meeting kicks off on March 15th. Will it be a bad omen for the U.S. financial markets as well as interest rates and home borrowing costs? The Fed has signaled that it will raise rates at the meeting and, it will continue to taper its asset purchase program.
Well, the lead-up to the meeting has seen Mortgage Bond prices get crushed while the 10-year yield has risen to 2.05% from 1.52% in early January. The 30-year fixed-rate mortgage has jumped to 3.70% from 3.11% at the beginning of the year.
Also, housing affordability continues to decline as rates rise and with prices at lofty levels. The latest numbers reveal that affordability fell in December as the median family income rose by 4.5% while the monthly mortgage payment jumped 22.5%. Meantime, the median existing-home sales price rose 16.1% from one year ago.
It could be that when the Fed announcement is made, the markets and the housing sector may already have it baked into the cake and, there may not be a big reaction. Whatever the Fed does should not deter potential homebuyers as the need for housing will always be there as households form and the population increases.
Bottom line: Rates are still historically low but always remember, jobs buy homes. If you are secure in your current position or think you can easily move to another job, homeownership should be in your grasp.
Source: Mortgage Market Guide
We are ready to help you find the best possible mortgage solution for your situation. Contact Sheila Siegel at Synergy Financial Group today.
