Summary:
Federal Reserve cuts benchmark interest rate by half a point.
Over 80% of mortgages are now under 6%, boosting buying power by $70,000.
Sellers may notice changes more slowly; buyers should act quickly.
Garman advises: Now's the time to buy!
Low inventory has led to buyer fatigue, but rate cuts may improve affordability.
The Impact of the Federal Reserve's Rate Cut
The Federal Reserve has made a significant move by cutting its benchmark interest rate by half a point, sparking excitement among potential homebuyers in the Susquehanna Valley. Local realtor Sean Garman, co-partner of Garman Builders, believes this change will encourage buyers to re-enter the market, marking a dramatic shift after more than two years of elevated rates.
"It's actually going to spur buyers to come back out into the market," says Garman.
Increased Buying Power
With over 80% of mortgages now under 6%, this rate cut effectively increases buying power by approximately $70,000 compared to last October. This means that many potential buyers can afford more, making it an attractive time to purchase a home.
Sellers Should Stay Optimistic
For sellers, the impact of this rate cut may take a bit longer to manifest. Garman advises not to worry, as awareness of the rate change will gradually trickle into the market. If buyers have been searching for a while, they are likely to act quickly once a suitable home is available.
Advice for Buyers
Garman's key advice for prospective buyers is to act promptly:
"If rates go up, you can't change your rate. If rates come down, you can always refinance, so I always say now’s the time to buy."
Addressing Buyer Fatigue
Garman has noted a trend of low inventory in the Susquehanna Valley, leading to what he describes as 'buyer fatigue.' However, he remains hopeful that this recent rate cut will rejuvenate the market and ultimately enhance affordability for buyers.
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