It was a cold November morning as I took my first step into the dark canyon. The challenge of running to the north rim and back awaited; but this journey was greater than the 50 miles before me. This was about discovering the greatness that lies within us. We all have dreams, desires to achieve what others say cannot be done. With passion, hard work and the willingness to suffer, our success awaits.
"Life is either a daring adventure or nothing" - Helen Keller
He,
ReplyDeleteGot a question: Could you elaborate on:
A 100 bp rise in 10 year yield equates to about an 11% drop in home prices.
Are you suggesting this to stunt Freddie/FNMA bonds as investors flock to TBILLS verus MBS? Thus cutting the never ending funding into housing?
Thanks
If you are buying a house let's say you have 2,000 to spend on a mortgage payment each month. For argument sake say this means you qualify for a 200,000 mortgage. So you are going to put down 20,000 plus the mortgage means you can afford a home for 220,000 right? All of a sudden rates rise 100 bp (say from 4.5 to 5.5% on a 30 year fixed). Your 2,000 monthly budget for a mortgage payment now qualifies you for a 180,000 mortgage and no longer 200,000. The result, instead of shopping for homes in the 220,000 price you are shopping in the 200,000 price. I made up the numbers for this example but the concept is the same. Make sense?
ReplyDelete