The attached chart shows the historical correlation and sequencing between the CPI (Consumer Price Index), Recession and Mortgage Rates. The blue line is the CPI, the red line is the 30 Year Fixed Mortgage Rate, and the gray-shaded areas are recessions.
Observations:
The Federal Reserve wants to avoid the 1979 and 1981 miss moves when they thought they beat mega high inflation and had to come back to fight inflation again within a couple of years, twice as hard.
Mortgage rates drop during and after a recession.
We haven’t seen inflation or mortgage rates jump with the intensity we’ve recently since the early ’80s.
History will repeat.
If you are in the Los Angeles area and have any questions or real estate sales or financing needs, feel free in contacting me
Ron Henderson GRI, SRES, SFR, RECS, CIAS
President/Broker
Multi Real Estate Services, Inc.
Gov’t Affairs Chair – California Association of Mortgage Professionals (2017-2018)
Chairman – OutWest Marketing Meeting (Real Estate Education)
BRE #00905793 NMLS #310358
www.mres.com
ronh@mres.com
Specialist in the Art of Real Estate Sales and Finance
Real Estate market, mortgage rates, Los Angeles, San Fernando Valley, Conejo Valley, Simi Valley, Woodland Hills, West Hills, Calabasas, Chatsworth
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