While I agree with your analysis – what about the dog that isn’t barking? I have asked many mortgage folk (who admittedly have plenty of time on their hands to ponder such things) about the consequences of lowering the rate to the proposed 4.5%. Let’s say by some miracle it did spark a wave of sales (which it won’t but let’s be cautiously optimistic for a moment). Now we have millions of homeowners sitting on 4.5% mortgages. What then is their incentive to move 5 years from now? They would be better off renting their home out should they outgrow their current residence. Yet another example of selling the future to fix the present.
A note to our great government: Quit trying to help while we have a chance. Let the market dictate policy.
That’s it from one of those dreary states that starts with a vowel.
Dan
Cincinnati, Ohio