Great Britain’s vote last week to exit the European Union came as a surprise and has caused immediate ripples in international financial markets. It has definitely created uncertainty and its final impact will not be truly known for many years. Nevertheless, economists are predicting that the U. S. economy will weather the Brexit storm.
- S. home mortgage rates, which are already at historic lows, have dropped even lower. Greg McBride, chief financial analyst at Bankrate, expects rates could sink to record lows in the coming weeks. “If you’re a borrower, don’t wait to lock your rate,” he said, “as this opportunity may not last long”.
McBride said his long-term outlook does not change with the Brexit vote. He still estimates a rebound from super-low rates by year’s end. Similarly, Mortgage Bankers Association chief economist Michael Fratantoni, expects rates to reach 4 percent by the end of 2016.
So what does this mean if you are thinking about selling your home now? Basic fundamentals still apply. Homes are in high demand and inventory is extremely low. Brexit doesn’t change that.
Likewise, if you’re thinking of buying, again, basic fundamentals apply. Interest rates will never be lower. If you’re thinking of buying your first home, you can benefit greatly by locking in now. For those looking to buy in high-priced areas such as Bethesda or DC, the recent dip in interest rates can make already expensive homes just a bit more affordable.