Brexit Might Be Good for American Homeowners, So I Guess That’s a Plus?

Mortgage rates are dropping, thanks to a number of factors including Britain’s vote to exit the European Union.

Photo credit: Bill Ward, CC BY 2.0.

My investment strategy post-Brexit is the same as my investment strategy pre-Brexit — do nothing—but that hasn’t stopped me from keeping an interested eye on my 403(b) over the past week.

The day after the June 23 Brexit vote, my investments went up. Then they went down. Today, they’re starting to go back up again.

So I’m not too worried about my retirement fund, especially since I still have somewhere between 35 and ∞ years before I retire.

The Washington Post agrees that your post-Brexit financial energy probably shouldn’t go towards messing with your retirement fund. Instead, they want you to think about refinancing your mortgage.

How Brexit could push mortgage rates to historic lows

Greg McBride, chief financial analyst at Bankrate, said rates could sink to record lows in the coming weeks. “If you’re a borrower, don’t wait to lock your rate,” he said, “as this opportunity may not last long.”

They’ve already hit rock bottom this year. In the past month alone, 30-year fixed-rate mortgages have hovered around 3.7 percent, nearly a three-year low. Britain’s vote to leave the European Union is expected to drive rates even lower.

Billfolder Andnowlights tipped me off to this story, noting that she is getting ready to become a homeowner but is probably going to miss out on the low rates:

It’s especially painful for me to read this because we’re about 10 months away from starting to look at houses and I wish SO BADLY we could buy now but we’re just in no place to do so, both because we have a 15 month lease and since AC JUST got done with PhD school, no down payment. We could, in theory, borrow from our parents, but we really don’t want to be in debt to either set of parents (frankly, my dad could give us the cash outright but like so many people in the upper income brackets, he’s just not that generous). I will be so angry when we have to get a higher interest rate because the timing is completely wrong!

Is anyone else thinking about refinancing a mortgage or jumping into the housing market to take advantage of these historically low rates?

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