Do Rates Need To Be Lower?
Do mortgage rates need to be lower to stimulate the housing market into growth? Many believe that the 30-year mortgage needs to be below 4% to really pump up the housing market. Making loans more attractive to purchasers of homes is one way to stimulate the market.
Lower rates are going to depend on the profit margin and hedging costs at the loan company level. Compared to previous moves down, lower 10-year rates in the Treasury Bond market are translating into lower mortgage rates. Perhaps companies are going after market share in trying to generate more mortgages to pump up their profits in origination fees?
If lower rates are going to stimulate the housing market, I hope it works and works soon.