The Federal Reserve cut interest rates on Wednesday for the first time since 2020.
To understand how this rate cut affects buyers, several homebuyers who were waiting for mortgage rates to drop before making a move shared their thoughts and plans.
‘The Fed cut gives me hope—I’m listing at the end of the month’
Camille Bradbury, 39, is preparing to list her home in Taos, NM, by the end of this month due to the recent rate cuts. She plans to rent until she can afford another property. “The Fed cut is a hopeful sign to me as a buyer,” says Bradbury. Despite hoping for rates to go down to 5%, she doubts it will happen. “I think 6% is as good as it’s going to get unless we have another pandemic or recession,” she adds.
‘I decided to buy before the Fed cut—and am glad I beat the crowds’
Kathi Kendall, 62, intended to sell her Phoenix property later this fall but decided with her agent Rebecca Hidalgo Rains to list it earlier. “I ended up having three showings and taking an offer before my home even hit” the multiple listing service, says Kendall. She accepted an all-cash offer for $750,000 and used the proceeds to purchase a new home in a 55-plus community near Scottsdale without needing a mortgage. “Knowing that lower Fed rates were coming did give me that extra confidence,” says Kendall.
‘The Fed rate cut means more buyer competition’
Yancy Forsythe, 42, a real estate investor in Kansas City, MO, aims to buy his next investment property soon. He is looking for a single-family home priced between $250,000 and $300,000 that requires minimal renovation. The half-point rate cut was more aggressive than he expected and may increase buyer competition. However, Forsythe believes economic uncertainty might still deter some buyers. “The reduction in rates is likely to make borrowing costs a bit more affordable,” he notes.
‘The Fed cut makes us want to move fast’
Jonathan Ross, 47, and Jennifer Ross, 45, are accelerating their plans to buy a new home near Fort Worth, TX following the rate cut. “The rate cut was larger than I expected,” Jonathan says. They anticipate increased house prices and competition but plan to refinance later when rates dip further. They are currently exploring potential neighborhoods and aim to list their current house in November.
We’ll check back in with these homebuyers in a month for updates on their situations.
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