What The Fed's Latest Move Actually Means For Your Dollar

Federal Reserve Chairman Jerome Powell First Time Home Buyers

Inside what the Fed’s latest move actually means for your dollar, I break down Federal Reserve Chairman Jerome Powell’s latest announcement, how the cost of money affects your purchasing power and the great opportunity this presents to first-time home buyers!

Photo by Jon Cellier of a neon red sign that says Best rates on a rooftop of a building in a city on Unsplash First Time Home Buyers
Photo by Jon Cellier on Unsplash

Federal Reserve Update 9.18.24

Exciting News for Homebuyers and Investors:

The Federal Reserve made a significant rate cut on Wednesday, signaling a shift towards easing its economic restraints. This move is already translating into lower interest rates across various lending products, potentially providing substantial savings for millions of Americans.

Major financial institutions like American Express and US Bank have already reduced the APR on several credit cards by 0.50%, matching the Fed’s recent cut. But more notably for real estate, mortgage rates have dropped to their lowest level since February 2023, according to Freddie Mac.

This reduction is a game-changer for those looking to purchase a home or refinance. Lower mortgage rates mean more affordable home loans, giving buyers increased purchasing power and creating a prime opportunity to lock in better rates. Even better, the Fed has hinted at more rate cuts in 2024, making this an ideal moment to explore the real estate market.

Now is the time to act—take advantage of these favorable conditions and make your homeownership dreams a reality!

Federal Reserve Interest Rates

Last week, Federal Reserve Chairman Jerome Powell announced a pivotal shift in policy, indicating “the time has come for policy to adjust.” This decision, driven by a decline in inflation and a cooling labor market, sets the stage for potential opportunities in the housing market. While the official rate cut will be confirmed at the September 17-18 Federal Reserve meeting, the anticipation is already making waves. The stock market’s positive response to Powell’s announcement has traders speculating on a significant half-point rate cut, increasing the chances to about 33%. This potential reduction could be a game-changer for your home financing strategy, though the official details are still pending.

Photo by Soroush Karimi of the Federal Reserve Bank in San Francisco on Unsplash
Photo by Soroush Karimi on Unsplash

What The Fed’s Latest Move Actually Means For Your Dollar

The Federal Reserve’s decisions influence mortgage rates, affecting your homebuying power. Although mortgage rates don’t align with the federal funds rate, investor expectations, and economic conditions play a crucial role. With inflation easing faster than expected, a rate cut could be on the horizon, translating to lower mortgage rates in the near future. Imagine the benefits: a potential decrease in mortgage rates means lower monthly payments and substantial savings over the life of your loan. Ensuring your credit profile is in top shape will be key to capitalizing on these potential savings. Recent data from the National Association of Home Builders (NAHB) highlights a thriving market for new homes, with sales jumping by 10.6% to a seasonally adjusted annual rate of 739,000. Fresh data from HUD and the U.S. Census Bureau bolster this surge.

Photo by Soroush Karimi of first time home owners cooking in their kitchen on Unsplash First Time Home Buyers
Photo by Soroush Karimi on Unsplash

First Time Home Buyers

Furthermore, starter home sales have surged by 10% year-over-year, reaching their highest levels in almost two years. First-time buyers waiting for improved prices and inventory actively pursue their dream homes. The recent decline in interest rates is fueling growth in starter home sales. This is a golden opportunity for first-time buyers, particularly sensitive to rate changes due to lower down payment capacities. Lower rates could significantly impact your mortgage terms and monthly payments, making homeownership more accessible. Don’t miss the chance to enhance your buying power and secure a great deal on your new home. Connect with me today to explore how these developments can benefit you!

Your Next Home Starts Here

Thank you for looking at what the Fed’s latest move actually means for your dollar. I hope you have a more precise breakdown of Federal Reserve Chairman Jerome Powell’s latest announcement, how the cost of money affects your purchasing power, and the great opportunity this presents to first-time home buyers!

Let’s connect and discover what real estate opportunities are right for you. I specialize in historic and architecturally significant properties in the Northeast regions of Los Angeles and neighboring communities. Check out my recent reviews on Instagram with first-time homebuyers. HERE

David Clark Real Estate Advisor with The Shelhamer Group. Hurry California's Spectacular Dream For All Program Is Here, Dream For All Program, Down Payment Assistance, First Time Home Buyers, CalHFA Dream For All Loan

805.280.1425

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Based on information from the / Association of REALTORS® (alternatively, from the /MLS) as of [date the AOR/MLS data was obtained]. All data, including all measurements and calculations of area, is obtained from various sources and has not been, and will not be, verified by broker or MLS. All information should be independently reviewed and verified for accuracy. Properties may or may not be listed by the office/agent presenting the information