The market is very tied into the bailout loan proposals for the auto industry and the anticipation of the President elect Obama’s capital expenditure program. The market could continue to benefit with low rate mortgage loans as the government works in overdrive to try and jumpstart the housing market.

The market has been under severe pressure from the rapid increase with oil prices. There is a growing concern that the level of inflation in the market will continue to grow, despite the slow down with the overall economy as energy prices continue to climb. The economy has been quite resiliant in the 2nd quarter. Ben Bernanke recently issued statements stating that he believed inflation would slow down as the economy slowed down, but many investors are now concerned that the Fed would look to increase the fed funds rate as early as the fall of 2008. The housing market has yet to break out of its down turn and higher mortgage rates will place a further strain on this industry.

Consumers who may be in the market to buy a home or are considering a refinance should act soon to lock into fixed rate mortgages as there is a good chance interest rates will continue to move up through the course of the summer.