A New House: Risks and Benefits

Topics: Monetary policy, Real estate, Federal Reserve System Pages: 1 (255 words) Published: October 1, 2011
A New House Risk and Benefits

The national fiscal policy is the use of government expidenture and their taxation in order to influence the economy and influences the economic status in order to affect the rates of the housing market. There are different government bodies that have an effect on the national fiscal policies one influence is the Federal Reserve which determines the direction in which the interest rates will go whether they rise or fall. When there are lower interest rates it will increase the demand for houses in the market, during this time in the economy it is the best time to purchase a home because the prices will often be lower than usual, and will provide more people with the opportunity to buy. Federal banks can affect mortgage rates and housing prices because they have the opportunities to determine interest rates which will affect mortgage rates. When making the decision to buy a home you should take into consideration how high your interest and mortgage rates are going to be because you don’t want to end up paying more than your home is actually worth, during this economy if you have the opportunity to buy a home it would be the best time to do so because there are many houses on the market that are at very low set prices and rates because it is hard to sell which means you have an option to get a fixed rate instead of a variable rate that could change over time.
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