The Effects of Low Interest Rates on Housing Markets free essay sample

A paper which discusses how lowered interest rates are affecting the housing industry in the United States. The paper shows that bank interest rates have been steadily decreasing since the September 11th attack on America and that the attack caused the business failures of major corporations, such as World Com and Enron. It discusses that one of the areas that are going stronger then ever is the real estate industry and many homeowners are taking the option to refinance their homes. The paper shows that banks and financial institutions are not in favor of this procedure as a homeowner who refinances his house may lower his monthly payments several hundred dollars banks are making significantly less money on the lowered monthly payments through refinances. The purpose of the essay is to discuss how the lowered interest rates are affecting the housing industry. House sales are running a record high this year, according to Reaser, chief economist of Bank of America. We will write a custom essay sample on The Effects of Low Interest Rates on Housing Markets or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The refinancing of mortgages is supporting a major portion of the economy that is surviving and thriving. At the present time, refinancing is showing no signs of slowing down; in fact it is steadily increasing. People are putting the extra money into home improvements and buying new cars, another low interest financing option.