PulsePoints

If economists at the Federal Reserve Board have it right, a return to economic normalcy is not in the cards anytime soon.

In the Dickensian picture painted by the Fed, unemployment remains high but the odds of inflation ramping out of control are low. Both household and business spending have been increasing, but international spillover from the European debt crisis is causing further contraction in the U.S. capital market. Says Jeff Davis,

From the perspective of senior housing/healthcare owners and investors, it is the best of times because interest rates are near historic lows and drifting lower. But tight credit markets remain problematic. The Fed is suggesting that it could take another five to seven years for the economy to work its way back to what passed for normalcy not long ago.

In the meantime, senior housing/healthcare owners may be well advised to consider a long-term financial strategy that is both patient and opportunistic. Although opportunities for funding new construction are limited, refinancing an existing loan using the new HUD Lean product should make sense to a growing number senior housing/healthcare owners.

For example, for borrowers who can take advantage, interest rates on HUD 232 LEAN loans are near rock bottom after drifting steadily lower in recent weeks.

HUD rates tend to move up and down based on developments in the U.S. government bond market. And rates on 10-year Treasury notes have been moving steadily lower, from 3.76 percent in April to 3.03 percent by mid-July, as investors forsook volatility in the stock market.