Here’s how lower interest rates could affect you when buying a home
AUGUSTA, Ga. (WRDW/WAGT) - With the Federal Reserve set to meet next week, people are expecting interest rates will finally be coming down.
That’s good news for people looking to buy a home.
We have a look at how a lower interest rate might affect you.
Experts are expecting a significant shift in the housing market, giving potential relief for buyers who want to take advantage of paying less over the life of a loan.
But local real estate professionals say there are still a few things to consider.
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With home construction showing no sign of slowing down, realtors expect that trend to continue as demand grows.
“I’m gonna get real busy. I’m already busy, but I’m gonna get busier,” said Real Estate Agent Daniel Ijigbamigbe.
The Federal Reserve is expected to start lowering interest rates after seeing inflation ease to numbers they haven’t seen in years.
Real estate agents are saying it’ll be a double-edged sword for homebuyers in the region.
“The rates dropping would lead to homes being more affordable. So that’s going to lead to lower monthly payments, and that will help buyers on the market absolutely be able to afford it. What the rates will also do on the flip end is it’s going to then drive that demand higher,” said Ijigbamigbe.
Census data shows counties like Aiken and Columbia have seen significant growth over the last decade.
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With no signs of slowing down, mortgage brokers say now is the time to pay attention.
“If you go ahead and purchase a two or $300,000 home now, you have that $200 to $300,000 home if you wait for interest rates to drop, and more people are demanding that same home. That now means that the sellers can really charge a higher price for that home. And so, six months from now, that same home could be priced at $325,000,” said Mortgage Broker William Hudson.
Like many new developments, it’s uncertain how the market will respond to cuts.
Only time will tell.
But a lot of home buyers are sitting on the sidelines, waiting for this moment.
The Federal Reserve will be meeting next week to decide on those interest cuts.
People in the housing market say they expect multiple cuts into next year.
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