Yesterday, the Federal Reserve raised short term interest rates by .25 basis points. This was the third rate increase in 2017.
The Federal Open Market Committee, headed by Federal Reserve Chair, Janet Yellen, indicates that the economy continues to grow, with more than 228,000 jobs added last month. The unemployment rate is around 4.1%. This, along with a robust stock market are good signs for our strengthening economy.
How does this affect you as a buyer? The interest rate increases are healthy and necessary. While they don’t directly affect mortgage interest rates, these increases will slowly start to cause them to increase. However, we’ve seen three increases this year and the mortgage interest rates have risen then dipped back down again. This morning, I see that the 30 year fixed rate is 3.75%.
It’s still a great time to buy a home in Northern Virginia!
The Fed has forecast another three rate hikes in 2018 and two hikes in 2019. We will wait and see.