Last week, the Federal Reserve announced that they are going to launch an aggressive program to spur the economy through open-ended commitments to buy mortgage-back securities and through their promise to keep interest rates low. The Fed stated that they will buy $40 billion of mortgage-backed securities each month until the job market improves.
The action taken by the Fed is known by the term quantitative easing, which is meant to drive down long-term interest rates and push investors into different assets. These actions are also expected to weaken the value of the dollar because the Fed will be effectively printing more money to fund their purchases. However, this should increase spending overall and will be a great benefit to the housing market.
In addition to their attempts to keep down long-term interest rates, they also stated that they expect for short-term interest rates to remain near zero through at least mid-2015. This is an improvement over previous statements, which predicted the low rates to remain only through 2014. They also added that they expect to keep interest rates near zero even after the recovery starts to strengthen.
The most recent quantitative easing announcement from the Federal Reserve is good news for those buying Atlanta new homes. A continuation of lower interest rates will help the market recover in our area, and will help buyers afford more house for their money.
If you’re looking to purchase an Atlanta new home, contact Academy Mortgage at 404-574-2600 or visit our website.
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