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Economy in Trouble: Bad for Stocks, Good for Housing

As the news about a slowing economy and fears of recession mount, the stock market has taken a huge hit, falling double-digit percentages in the last couple months, but housing is benefitting.

 As money has been taken out of stocks, it has been flowing into bonds, which are historically a very safe investment.  When demand for bonds rises, that reduces the interest rate paid on those bonds.  As the bond market goes, the mortgage market follows.

We’ve seen substantial improvements in rates in just the last week, testing new multiyear lows and closing in on all-time lows!  With falling sales prices and lower mortgage costs, housing affordability is climbing quite quickly and if the mortgage rates stay at these levels into February, we’re going to see the best affordability on homes in the Twin Cities since 2004.

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TwinCitiesRealEstateBlog.com is not a Multiple Listing Service MLS, nor does it offer MLS access.
This website is a service of Aaron Dickinson of Edina Realty, a broker Participant of the Regional Multiple Listing Service of Minnesota, Inc.