The FOMC meetings rounded up today and as expected, the QEIII tapering is right on schedule. As presumed, the Fed will be reducing the amount of mortgage backed securities and Treasuries they purchase each month by another $10 billion. Prior to the meetings last December, the monthlyFed taper to continue purchases amounted to $85 billion per month before dropping to $75 billion mid-December.

The subsequent $10 billion January reduction confirmed reports that the Fed will continue to pull back the stimulus by $10 billion per month until QEIII is halted altogether. The FOMC is next scheduled to meet March 18 and 19.

Okay, so now what? Apparently the stock market didn’t like it as much as it did right after the December meetings as the Dow quickly fell by nearly 200 points, wiping out gains accrued so far this week but following a trend that started on Thursday, January 23 when concerns about emerging markets along with an apparent contraction in the Chinese economy.

Funds have been flowing out of equities and into fixed vehicles such as Treasuries and mortgage-backed securities. Oddly, the implementation of the Fed taper has actually caused rates to fall instead of the other way around. The $85 billion per month is designed to keep rates low and any indication of a pullback should have caused rates to approach 5.00 percent.

That means for at least the next few months, interest rates for real estate investors should remain at or near their current levels at least until spring. For real estate investors who have been eyeing a few projects but not yet made a commitment might consider moving with a bit more conviction as financing costs are still well below levels expected later on this summer and fall. For now, 30 year mortgage rates for investor properties are still hovering near 4.50 percent, a very attractive rate indeed.