Two New York Federal Reserve Bank economists are asking whether the tax reform act that went into effect at the beginning of 2018 is playing a role in the decline of home sales.  Richard Peach and Casey McQuillan, writing in Liberty Street Economics, say that the broad-based slowing in housing market activity coincided with a roughly 70 basis point rise, from 3.9 percent to 4.6 percent, in the thirty-year fixed-rate mortgage.  During the period in which rates were increasing, from the fourth quarter of 2017 to the third quarter of 2018, new home sales declined 7.6 percent and sales of existing homes dropped 4.6 percent.


...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.