With the Federal Reserve being on the verge of raising Boston North Shore interest rates for the first time in several years, at least one economist says there is little to fear. Mortgage rates will stay low for a good while, says the Wall Street Journal’s chief economics correspondent, Jon Hilsenrath, even if the Fed does decide in favor of a rate hike.
Boston North Shore Interest Rates: Why They Won’t Rise
Hilsenrath feels mortgage rates won’t be affected much, if any, despite what the Fed does for these main reasons:
1. The U.S. economy and, indeed, the global economy remain relatively weak, meaning the Fed won’t raise rates substantially in that environment.
2. The Fed has already said they don’t expect a big move primarily because inflation is so low.
Hilsenrath also points to the fact that we are entering a period of what will be a very slow progression of follow-up interest rate increases. The last time the Federal Reserve raised the interest rates, from 2004-2006, there wasn’t much of an increase in Boston North Shore interest rates for mortgage loans, and the U.S. actually experienced a housing boom. Historically, therefore, he sees a precedent that most likely will be repeated — or, at a minimum, will not affect housing’s continued improvement.
Asked if the Fed does increase Boston North Shore interest rates, will prospective home buyers rush to take action fearing other increases may occur, Hilsenrath said he doesn’t anticipate consumers will react out of fear. He thinks people will simply realize a rate increase “didn’t mean the world will end” and will go about their daily lives as if little had changed.
When asked about whether it was a good time for mortgage holders to refinance, Hilsenrath said the time for consumers to refinance is when it feels right to them. If there’s an opportunity now, people should probably take advantage of it.