A bigger concern in the short term will be when the FED stops, or reduces their ongoing purchase of mortgage backed securities, which has been artificially keeping interest rates low.
As we progress it to early and then mid summer 2014 - one should expect the benchmark 30-year fixed to be in the mid 5% range. While historically that is an awesome interest rate, whenever we see rates move up, we tend to have a 6 - 9 month drop in purchase activity as buyers become disenchanted with the higher rates. After awhile, those potential buyers accept the reality, and new buyers getting quoted the 5% rates just accept it from the get go.
I don't know. I think it is driving prices high again and that is making homes too expensive. There are so many houses that need to be remodeled, but as the prices keep going up, the costs to fix them go up too and make them less affordable for people.
Read the blog here: http://www.furlongteam.com/category/blog/
Purchase Manager / Loan Officer
2801 Hennepin Ave S
Minneapolis, MN 55408
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