Lime Realty Group is one of the leading realty groups at understanding the market and interest rates in Southern Utah. We watch what’s happening to better inform our clients of their options. And right now, the market is in a panic.
Of course the stock market jitters we’ve seen over the past week have many causes such as fear of an Ebola outbreak, the economic slump in Europe, the market finally accepting and settling in for a slow economic growth period and the looming end of the Fed’s bond-buying program.
We see most of this volatility as dramatic shifts upward and downward in the market, but these swings can have real world impact beyond the market itself.
Analyst Nicholas Bloom, professor of economics at Stanford University has studied the last 19 jitters in the US market and says these hikes and falls are normally followed by nasty contractions. And the reason for these contractions is fairly obvious. Volatility leads to uncertainty and when people and businesses are uncertain about the future, they pull their money out of stocks and invest heavily in more stable things like bonds. Or they horde money and save.
This lack of investment is what causes cash flow to slow down and the contractions to occur.
But what does this mean for you? A buyer? Or a seller in the real estate market?
These contractions can cause the interest rate to plummet. It’s possible we’ll see some record low rates here in the near future. That being the case, they won’t stay for long. Our advice is to watch the rate and lock it in quickly when you get a good one.
We’ll follow the rate and advise you further during the upcoming weeks. This may be a great time to buy and sell. Contact us today,
