BREAKING NEWS – San Diego Real Estate News ALERT – Federal Reserve Tapers 10 Billion
The Federal Reserve has decided to taper 10 Billion in Bond purchases. What this means is that there is the potential for Interest Rates to rise. Investors have already priced this into the market. If we start to see rates tick up it will most likely be within a .25% – .375% range. As of 11:10 a.m. the benchmark 10 year Bond has jumped .08% (Yielding 2.74%). This was an anticipated rally.
The market will overcorrect and then settle. What that means for San Diego home owners is that we will likely start to see an overall slowdown. Refinance transactions will slow. Buyers will be faced with reducing there price points due to the fact that they can afford less. Every .25% increase in rate means that they lose $75,000.00 in purchase capacity. As we approach the Summer Sale Season, I would expect to a pace slower than we saw in 2013, but still strong. San Diego’s Real Estate Market as a whole is still one of the most stable in the Country. Our weather, job market and affordability index is the strongest in the Nation. This week there was report that San Diego is the top City for start-ups’.
If you are considering buying a new home or are looking to sell, now is the time. Today’s news is simply an affirmation . . .