The Blog

With presidential elections only a week away we thought it would be interesting to research this question. Believe it or not there is a significant amount of data showing that presidential elections do play a role in determining mortgage rates for the coming months. The consensus among many economists is that mortgage rates generally remain low before an election because of the high degree of uncertainty in the results.

The reason for this assumption can be further explained because of two distinct reasons. First, as we all know, the Fed has the power over the interest rates concerning mortgages within the country. Because of the elections, the Fed will most likely not raise rates. New residential construction rates are up nearly 15% and mortgage rates are the lowest they’ve been since 1971 when they began tracking these numbers at nearly 2.25%! The incumbent president tries to keep these numbers as low as possible in order to show growth and stability coming back to the market. This nearly guarantees low rates for refinancing and new mortgages.

Secondly, large investors around the country are very wary to invest in a “pre-election” market because of the potential tax-policies brought on by the elected president. This causes these investors to hold their cash in safer U.S Treasury Bonds and mortgage-backed securities, keeping rates at the status-quo, which in our current case is low.

This year NBC News rated both Bloomington/Normal and Peoria in the top 10 rebounding real-estate markets in the nation! Our community has seen steady growth in population, job hiring, and new home sites. Regardless of the outcome of the election, there is no reason for these signs of growth to change, so with the potential change in mortgage rates, we at O’Neal builders conclude that there is no reason to delay if you are interested in purchasing a new home. Visit our website to learn more about our new homes in Central Illinois.

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If you’re ready to talk about your new home building needs, call us today at 309-454-6700.