I know it seems like we’re still in a recession – and we may be – but we won’t know for sure that it’s over until long after it’s over. The average life of economic recessions is about 18 months. We’ve been in this one since December 2007. You do the math.
What does that mean for mortgage rates? They are probably very close to what we’ll look back on as an historic bottom. Indeed, expect home loan rates to creep up this coming week because Friday’s bond auction market was not as strong as anticipated. Remember: Weak economic news normally causes money to flow out of stocks and into bonds, helping bond prices and home loan rates improve, while strong economic news normally has the opposite result, causing bond prices to move lower and home loan rates to worsen.
It’s hard to think we’re hearing “strong economic news” when the news is that more than 500,000 people lost their jobs. But, sad as that is, it’s fewer than the 600,000-some that lost jobs the month before. And, there are other signs of an economic upturn, including the rising stock market itself.
Meanwhile, to help bring this turn-around, the U.S. Government has been pumping money into the economy. At some point, and we may be at that tipping point, the markets’ fears will turn to inflation instead of recession. That means bond rates will rise and, along with them, home loan rates.
So, if you’ve been thinking of refinancing – do it now. If you’ve been thinking of buying a home, don’t count on mortgage rates being as low in a few months as they are now. To start the process of buying a Flagstaff home, contact Team Heitland at RE/MAX Peak Properties! | 
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