Wondering how the Coronavirus is impacting mortgage rates? SIGNIFICANTLY! Mortgage rates are highly correlated with the movement of the 10 Year U.S. Treasury Bond Yield. When this indicator rises, mortgage rates will likely rise; when it falls, mortgage rates will follow. The reason the yield on the 10 Year Treasury has fallen so much recently is driven by the stock market crash and the Coronavirus news, as investors dump stocks and reallocate into safer investments. From finance 101 class, bonds have an inverse relationship – as their values rise, yields fall. Higher demand for bonds causes the yields to decline, thus explaining the significant drop recently.
What does this mean? The lowest mortgage rates we have ever seen! The opportunity to buy real estate with insanely cheap financing is here. Let’s do this! #letsbesmarterbuyers