Tim Sloan, Wells Fargo & Co. (WFC) Chief Financial Officer recently stated that Rising mortgage rates probably won’t slow the housing recovery because new families are being created and homes are still affordable.
“We don’t believe that the recent increases in mortgage rates are going to in any way, shape or form snuff out the housing recovery,” Sloan said yesterday at an investor conference in New York. “When you look at any sort of statistics in the demographics in terms of household creation as well as household affordability, they are still very attractive and should drive a continued recovery in the housing business.”
According to an August report from the Federal Housing Finance Agency, Freddie Mac’s and Fannie Mae’s overseer, The average rate on a 30-year fixed-rate mortgage has risen more than 1.2 percentage points since hitting a low of 3.35 percent in May, according to Freddie Mac data. That hasn’t slowed U.S. home prices, which rose 7.7 percent this year through June.
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