BISMARCK, N.D. (KFYR) – The Federal Reserve is meeting next week, and it is expected they will raise interest rates.
As inflation soars to 40-year highs, the Federal Reserve is thought to be raising interest rates another 75 basis points next week. While the Fed doesn’t set mortgage rates, homeowners or those seeking to buy for the first time will eventually feel the effects.
“It will make it harder for the first-time home buyers. Up-graders, it’s still a healthy seller’s market, so they’re able to roll that equity and they’re paying a higher interest rate, but all-time interest rates at 5% are still pretty good,” said Bill Dean with Better Homes and Gardens Alliance Group.
One first-time home buyer started looking for his property at the beginning of the year but wasn’t pressured by the rising rates.
“I kinda accepted that it was going to be high no matter what, so maybe a little bit before things really took off,” said Seamus Waters.
Rates have almost doubled since the beginning of the year, leaving many buyers with reduced purchase power, couple that with high interest rates and high home prices and that could lead to a slowdown in the market. Mortgage rates peaked in the early 1980′s when a 30-year fixed rate was about 18%. They dropped to a low of 2.68% in December of 2020.
Copyright 2022 KFYR. All rights reserved.