The minutes from the September Fed Meeting have been released and needless to say, it was a heated meeting. However, most of the Fed members agreed that we are not yet in a position to increase the rate of short term funds and that the purchase of Mortgage Backed Securities should be extended.
According to Greg Robb's article in MarketWatch FOMC minutes reveal depth of disagreement over outlook
"But the minutes of the Federal Open Market Committee meeting of Sept. 22-23 reveal that below the veneer, officials have a wide range of views about where the economy is headed and therefore where Fed policy needs to be. The wide range of opinions about the economic outlook and the Fed's unprecedented policies had been expected by Fed watchers given the "cacophony" heard from officials in their public remarks.
Some officials believe that the Fed will need to tighten policy sooner rather than later. Others are worried that a weak recovery might cause a dangerous downturn in prices. Most Fed officials agreed that a recovery has started. But there was little agreement about the strength of the expected upturn.
There was a "range of views" expressed about the Fed's unprecedented credit-easing policies. Some Fed officials wanted to boost the size of the Fed's purchase of mortgage securities, while one wanted to end the program early.
There was no appetite for hiking rates at this meeting because "the cost of the economy turning out to be weaker than anticipated could be relatively high," the minutes said. The Fed decided to extend its purchase of MBS and asset-backed securities into the first quarter to smooth them out and avoid any sudden end that might jolt markets"
So what does this mean to Oregon Homeowners?
If this is correct, we should continue to see 30 year fixed rates below 5% into the 1st quarter of 2010. this bodes well for those who have yet to refinance and for those looking for a home. Fall and winter are usually poor times to sell a home in Oregon as the weather is generally bad. This should mean sellers are more willing to accept a reasonable offer, then wait for a higher one.
Time will tell.
Feel free to call me to get yourself or your clients qualified for an Oregon Home Loan today. 503-421-0096.
Larry Morris is a Certified Mortgage Planning Specialist in Portland, Oregon. He specializes in USDA Guaranteed Rural Home Loans, FHA Purchase and Refinance, FHA 203k Rehab loans, FannieMae HomePath loans, Oregon VA Loans and conforming purchase and refinances in the states of Oregon, Washington and Idaho.
He can be reached at 503-421-0096.
