1970s: High interest rates and rising inflation affects new mortgage seekers | National News

Unchecked inflation in the 1970s had a huge effect on mortgage loans as the Federal Reserve pushed interest rates higher and higher to compensate. This led to rates jumping from the mid-7% range in 1971 to more than 9% in 1974. The rates were pushed even higher over the next several years as inflation problems persisted, and mortgage lenders had to increase their rates to keep up.

By 1979, interest rates hit a whopping 11.20%, which made it incredibly difficult for mortgage seekers to afford a mortgage loan. With the dollar value low and interest rates high, potential homeowners were pushed out of the buying market throughout the 1970s—and well into the next decade.

Source

Leave a Reply

Your email address will not be published.