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What the Heck is Going on with Interest Rates?

Posted By Wally Reule @ Nov 21st 2016 2:08pm In: Sedona Real Estate Market News

Well, the bottom line is that since the election, they've been going up! But why? Investors expect that the new administration will increase fiscal stimulus, which will be good for stocks but bad for bonds. These changes will increase the risk for inflation in the future, and higher inflation reduces the value of cash flow from bonds. So investors will demand a higher yield, which will lead to higher mortgage rates. Interest rates will still probably remain on the low side compared to historical rates, but they're definitely on the way up for now.

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