January 20, 2006
Home mortgages - Watchers Worry About China

China‘s recent signal that it may diversify its foreign investments in 2006 as mortgage industry watchers concerned that if China buys fewer U.S. Treasury securities this year as it may drive interest rates higher and pour more cold water on the real estate market. Home mortgage rates are closely tied to the Treasury rates and any rise in the cost of borrowing could further slow home sales. A series of increases in the overnight bank lending rate by the Federal Reserve since 2004 has already made adjustable-rate home mortgages more pricey and expensive.