Financial Update by Maurice Soussé

Rates are up considerably this week. It is ironic that we received two phone calls today with people stating “I read in the paper that rates are down….” Which led me to expound a bit on mortgage pricing these days. The interest rates are most commonly based on the 10 year treasury bill, which is why I am constantly writing about T-Bills. The 10 year treasury bill moves all day long just like a stock does.

Today for example, the 10 year T bill moved from 1.99 at opening to 2.07% at close. How does that effect you? We received three rate increases throughout the day today. That is an extreme day, but, has been happening more and more lately with the volatility of the stock market.

This leads us to the long term estimate of rates. If I knew their accurate direction, I would be a billionaire, but, we would be remiss to think that rates can stay this low for any prolonged period of time. Interest rates at these levels are not healthy in any way and is simply an attempt to kick start the economy.

So many times we hear clients “waiting” to purchase in the future. Two things will happen in the future; 1) rates will go up and 2) prices will go up. We can’t of course predict exactly when, but, those two things will happen, and it could be sooner rather than later. Is now one of the greatest times to ever purchase a home? It just might be.

One of the best quotes ever is from Henry Ford telling his staff “don’t find fault, find a remedy”.

Rates October 9, 2011, The Sousse Group