How Will the Brexit Impact the US Mortgage Market?
Days after voters in the United Kingdom cast the stunning vote to leave the European Union (EU), some real estate experts on this side of the pond were left wondering what immediate impact, if any, the British exit or the “Brexit” would have on the U.S. mortgage market.
That impact, those experts say, could be felt in the form of lower mortgage rates, an incremental increase in refinance activity, and additional demand for affordable housing that continues to outpace the existing supply.
“We will inch closer to all-time—or at least 60-plus-year—lows for 30-year fixed rates, but it will be harder to reach those levels than you might think,” says Keith T. Gumbinger, vice president of HSH.com, a market research firm.
With U.S. treasury rates falling, Doug Duncan, senior vice president and chief economist for Fannie Mae, expects mortgage rates to continue to fall in the short term, especially as the chances of the Federal Reserve hiking interest rates in 2016, he says, are now highly unlikely.