We’ve all heard about Brexit on the news and that it’s affecting the American stock market. The initial panic that some investors felt seems to have passed. So let’s look at how Britain’s exit from the European Union may impact the U. S. housing market.
The first obvious result will be on mortgage interest rates. For the last several years, interest rates have been at historic lows, and though many experts predicted an increase in rates, they have remained low during the first half of 2016. Thanks to Brexit, it is now even more unlikely that rates will rise very soon.
As the Washington Post recently reported, “Brexit has spawned the recent bout of volatility in global financial markets. That has anxious investors scurrying for safety — and few assets are safer than U.S. Treasuries. High demand for government debt pulls down interest rates. That all translates into ultra-low mortgage rates for American households. And with Britain voting for Brexit, they could go even lower.”
The low-rate effect may not last too long. Trulia’s Chief Economist Ralph McLaughlin points out that while Brexit will probably cause lower mortgage rates initially, he “expects them to rebound later in the year as uncertainty over the economic consequences of the departure lifts.”
So what does this mean for you? If you were considering buying your first home or moving up to your dream home, this may be the ideal time to act. The cost of borrowing money for home ownership may never be better! Call today to discuss your plans.
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