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Unformatted text preview: affect mortgage rates, housing starts, and housing prices. The Federal Reserve has been buying Treasury debts in 2009 in order to restore the housing industry in U.S. In the same way, after the recent recession, the Federal Reserve has been cutting discount rates in order to stimulate consumption and investments. A cut in discount rates will increase supply of money and therefore lower interest rates. As a result, this can help to increase demand for houses as consumers find it cheaper to borrow funds for spending. The increase in demand for houses can affect housing prices such as to bring about an increase in price. When purchasing a house, consumers should research on the plans and policies, which government bodies have implemented or are implementing to make a more accurate forecast of housing prices, which will allow consumers to make a purchase at a lower price to maximize their level of satisfaction....
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- Spring '10