Fed steps in and trys to say, this is the bottom!!
The Federal Reserve attempted to end price declines in the housing market on Tuesday with two new programs aimed at making it easier for consumers to obtain loans for homes, cars and on credit cards.
Under the new mortgage program, the Fed will buy up to $100 billion of debt issued by government-sponsored mortgage enterprises Fannie Mae, Freddie Mac and the Federal Home Loan Banks. It will also buy up to $500 billion of mortgage securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae. The Fed said that the actions were taken "to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved conditions in financial markets more generally."
Fannie Mae's current-coupon 30-year mortgage-backed security, which is tightly correlated on a spread basis to Freddie Mac's weekly survey of consumer mortgage rates, has fallen 38 basis points on the day, which means that the 30-year mortgage rates are likely to fall a similar amount. If they do, it would bring the average rate to 5.66%, its lowest since January when the average 30-year mortgage rate was 5.48% (the 2008 average is 6.11%). In Hudson County rates were as low as 5.50% as of Tuesday morning.
Under the new mortgage program, the Fed will buy up to $100 billion of debt issued by government-sponsored mortgage enterprises Fannie Mae, Freddie Mac and the Federal Home Loan Banks. It will also buy up to $500 billion of mortgage securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae. The Fed said that the actions were taken "to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved conditions in financial markets more generally."
Fannie Mae's current-coupon 30-year mortgage-backed security, which is tightly correlated on a spread basis to Freddie Mac's weekly survey of consumer mortgage rates, has fallen 38 basis points on the day, which means that the 30-year mortgage rates are likely to fall a similar amount. If they do, it would bring the average rate to 5.66%, its lowest since January when the average 30-year mortgage rate was 5.48% (the 2008 average is 6.11%). In Hudson County rates were as low as 5.50% as of Tuesday morning.
Labels: Hoboken Condo, Hoboken Real Estate, Hoboken real estate market, Hudson County condo, Hudson County real estate, Jersey City condo, Jersey City real estate, Mortgage rates
