The Fed and Treasury have both said that they key to recovery is keeping home prices high. (They call that a “recovery” in the housing market.) And the Fed has said it will buy more assets if it needs to in order to meet its goals. Put those facts together and my conclusion is that the interest rates will not be allowed to rise very much – maybe 100bp.
Is this what you were getting at – the impact on interest rates, and therefore home prices, that we should expect?
