Ben Bernanke’s low interest rates haven’t made life any easier for first-time home buyers. It’s almost impossible for this group to get a mortgage, never mind trying to compete with the well healed private equity guys. Cash is king in bidding wars and Wall Street has plenty of cash thanks to Bernanke & Co.’s free money truck.
The impact of rising rates has hurt first-time buyers the most, many economists and analysts say, because they are more sensitive to increases in monthly mortgage payments than are more established buyers looking to purchase their second- or third-generation home. The rate for a 30-year, fixed-rate mortgage stands at 4.58%, up from 3.59% two months ago.
The sour news pushed housing stocks lower yet again, a pattern on display since Fed Chairman Ben Bernanke in May acknowledged a change in policy could happen later this year. The iShares US Home Construction ETF fell 2.5% on Friday and is down 19% since May. Homebuilders KB Home, DR Horton and PulteGroup are down more than 30% apiece since May, while Lennar Corp. is off 25%.
Read more here.
Latest posts by E.J. Smith - Your Survival Guy (see all)
- Jon Tester: A Gun Rights Jekyll and Hyde - November 16, 2018
- Time-Out for CNN’s Jim Acosta - November 16, 2018
- “I Live in Maine, can I bring my Gun to New Hampshire?” - November 16, 2018