Feds Cut Interest Rates—What Does It Mean for Real Estate?
By • September 23, 2024 0 626
Last week, the Federal Reserve cut interest rates for the first time since 2020. This bold cut is kicking off part of a cycle that should prove to make new mortgages for home buyers more affordable.
The rate was slashed in half, bigger than the quarter point originally predicted. Over the last few years, the Fed’s rate increases slowed the housing market, causing home sales to drop. Homeowners couldn’t afford large monthly payments and sellers had to lower offers on their homes.
According to Chief Economist at the Mortgage Bankers Association Mike Fratantoni in an article on BankRate.com, if mortgage rates stay at the levels they now currently are, it will support a stronger than usual fall housing market and come spring 2025, a real bounce back.
In addition to home buying and selling, the interest rate cut could also help alleviate D.C.’s high rental rates. Home rentals are up almost four percent from 2023 and the average apartment rental in the city is over $2,200 per month (roughly $500 more than the average in the U.S.).
So, if you’re wondering whether it’s best to go ahead and buy now or wait for even lower interest rates, as it goes, things can go either way. There are factors like the election and the economy.
As broker Mike Opyd with Re/Max Premier said in an article in WUSA-9, if you’re serious about buying a home, it’s best to dive in now and get to it.
More information on the latest D.C. real estate news, visit our real estate page here.
