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Mortgage Rates Plunge To 3-Year Low Following Brexit Vote

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Mortgage Rates Plunge To 3-Year Low Following Brexit Vote

While it may take years to determine just how much the U.K.’s Brexit vote will impact global economies around the world, the Brexit has already had a meaningful impact on one major U.S. market: housing.

Stock markets have been rattled, and global economic growth is now facing a number of Brexit-related headwinds, but for Americans looking for a mortgage, the Brexit vote has been a major blessing.

U.S. mortgage rates have plummeted to three-year lows following the U.K. vote. A number of economists believe the Federal Reserve’s next interest rate hike has been postponed indefinitely, and some are even calling for a rate cut. The iShares Barclays 20+ Yr Treas.Bond (ETF) (NASDAQ: TLT)is up 5.3 percent since the vote.

Related Link: Citi Researchers Speculate On Next Interest Rate Move

According to Bankrate, the benchmark 30-year fixed mortgage rate is currently 3.61 percent. The Bankrate number confirms a report by Lendingtree Inc (NASDAQ: TREE) that there have been significant increases in refinancing requests and requests to purchase mortgage loans since the Brexit vote.

“This historic event has created an opportunity for US borrowers to lock in some of the lowest interest rates we’ve seen since December 2012,” founder Doug Lebda said.

National Association of Realtors Chief Economist Lawrence Yun has said that uncertainty in the British real estate market will also likely drive more foreign U.S. real estate investment, which could provide a boost to the U.S. housing market.

Disclosure: The author holds no position in the stocks mentioned.

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