Don't worry about Fed rate hikes

Guest perspective: Housing still vibrant

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Inman Connect New York | January 29 - February 1, 2019

You should not have been surprised that mortgage rates did not change last week after the Fed announced a 25 basis-point increase. Rates essentially remained unchanged because mortgage rates already incorporate the assumption that the Fed will continue increasing rates.

The following chart shows how mortgage rates moved down only slightly while the Fed was dropping rates from 2001 through 2003 and, conversely, we believe rates will tend to move up only slightly as the Fed continues to raise mortgage rates.