What are your predictions on conventional mortgage rates in the next six months to a year?
There is no need to predict, because the fed already stated their forward looking policy. They will be buying unlimited mortgage backed securities in an effort to keep rates low until the economy reaches full recovery. That means expect minimal rate change over the next 6-12 months. If you are looking to refinance, do it now. If you are looking to buy, do it when the deals present themselves as long as the numbers work.
Developer · Member since 2020 · 4k+ posts · 4k+ votes
5y
Why do you care? What is the decision your trying to make?
The reason I ask is there an off question behind the question, or just a general where will it go.
A. I will answer you in a general fashion, because the answer is an Individual decision.
Lets say interest rates are:
1. 4% on an SFR or MFH investment your looking at.
2. What % would you not make an investment at? For me I stop investing at 9%. If I was a Flipper and could move a property in 4 months, I would be okay at 15%.
3. Lets say your stop investing % is also 9%. Then to answer your original question, it doesn't matter as long as the interest rate is between 4% and 9%. Within 4 to 9% it becomes a deal by deal question.
B. From a macro standpoint, are you trying to not take the plunge. Is another approach. Because if it isn't the interest rate, it will be another issue, that keeps you from investing.
C. A general Interest rate discussion is a simple matter of Cash supply and Risk. 1. The Cash supply from an investment standpoint. There is still a lot of cash out there. The Federal government thru their spending is putting more cash out there. Thus interest rates should stay low. 2. However the economy was already hot. By the Fed putting more dollars out there, the economy will heat up even more, causing inflation. To correct they will need to raise the Interest rates to slow the economy down. 3. Risk from your personal finances and deal standpoint.
Thus what do you think the dynamics in C above, will occur in the next 6 months to a year? No investment you make should be dependent long term on these short-term rates. The short-term rates should only impact your decision to get "in".
Run your numbers using 3 different interest rates. Decide if the numbers work. Then lock in long-term, or over your investment horizon.
What are your predictions on conventional mortgage rates in the next six months to a year?
There is no need to predict, because the fed already stated their forward looking policy. They will be buying unlimited mortgage backed securities in an effort to keep rates low until the economy reaches full recovery. That means expect minimal rate change over the next 6-12 months. If you are looking to refinance, do it now. If you are looking to buy, do it when the deals present themselves as long as the numbers work.
Rental Property Investor · Albany, NY · Member since 2019 · 125 posts · 47 votes
5y
I don't 100% trust the Fed... It really depends on inflation. Which is dependent on whether the US will be fabricating more cash. In the next 6 months I would say approximately status quo... 12 months? Depends on what new stimulus/infrastructure gets passed.
Lender · Nationwide Lender · Member since 2019 · 391 posts · 140 votes
5y
@Ray Watkins
My prediction!
I think they will stay low for some time throughout this year. In the near short term I think it will get even better, but not too the lows we saw recently back in August.
Investor · Raleigh, NC · Member since 2019 · 433 posts · 743 votes
5y
Unless they go negative, meaning they'll pay you to buy a house, they can only go up. I think they'll pretty much stay they same, give or take a little, through the end of the year.
As much as I hate taxes and higher interest rates (huge capitalism fan over here), I just don't understand how the government is going to offset all the money printed in the past 18 months. It's the government just doubled/tripled the liabilities on their balance sheet and didn't add any assets to increase their income.