A fixed-rate mortgage can still be found at under 6%. That’s good news for buyers/borrowers.

Unfortunately, the days of low rates may be numbered.

As Holden Lewis puts it, “[I]n light of a tighter job market, the proper direction for bond yields is up, and that’s where they are heading. Mortgage rates will follow.”

The unemployment rate has dropped, nationwide, to 4.4 percent. That’s the best in five and a half years.

That would raise inflation fears at the Federal Reserve, on its own, but there’s more news:

Average hourly earnings in the private sector (seasonally adjusted) increased by almost 0.4 percent in one month, from $16.85 in September to $16.91 in October. That would be an annual rate of 4.3 percent. But there was an increase in average hours worked, so average weekly wages went up more than 0.6 percent, an annual rate of 7.8 percent.

7.8 percent??? no economist wants wages to rise that much in a year!

Wages go up when there aren’t enough workers looking for jobs.

The Fed wants low inflation. The only way to do that is to raise rates. Short-term rates.

Mortgage loans are long-term rates. They’ll go up, too.

More: Mortgage Matters – By Holden Lewis, Bankrate.com

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