No Joke: Housing Market Is On Its Own April 1
MARY LOUISE KELLY, Host:
NPR's Chris Arnold reports.
CHRIS ARNOLD: Over the past year and a half, the Fed has bought up $1.2 trillion worth of home mortgages, that's more money that was involved in the entire so-called TARP bank bailout. By making all that money available for home loans, the Fed has pushed down mortgage rates - that's been making it cheaper to buy or refinance a house, and it's been stimulating the economy.
SCOTT SIMON: An incredibly effective program impacting the mortgage rate, which is what they were trying to do.
ARNOLD: Scott Simon oversees mortgage-backed securities at PIMCO, a major investment management firm.
SIMON: Almost immediately, you had over a one percent drop in mortgage rates for the homeowner, and then ultimately, more like a percent and a half.
ARNOLD: But, others aren't so sure. Barry Habib runs Mortgage Success Source, which tracks rates and trends.
BARRY HABIB: Hey, if I know that dinner's not coming tonight, it doesn't mean I'm not going to be hungry. Well, I knew dinner wasn't going to be here so I'm not going to be hungry. Of course, you're going to be hungry. Of course, when you stop buying $8 or $10 billion a week it's going to have an impact.
ARNOLD: Chris Arnold, NPR News.
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