Dan Seiffert SVP, Accounting | realtors.com
A "Million Dollar Listing New York" star and Serhant listing agent has predicted a bright future for homebuyers following the Federal Reserve rate cuts on Sept. 18, suggesting that inventory and buyer leverage will improve.
Talia McKinney, who leads the Talia McKinney Team at Ryan Serhant's agency, discussed the housing market's future with Realtor.com® after the Fed issued its first interest rate cut in four years.
Policymakers announced a half-point rate cut, marking the first reduction since the COVID-19 pandemic began in March 2020. This development brings positive news for potential homebuyers who have been waiting to enter the property market, according to McKinney.
The former Bravo star indicated that while the cut might not prompt immediate action from buyers, it signals the start of a potentially more favorable market for those looking to purchase their first home.
"The Fed’s rate cuts are something everyone’s watching closely," she said. "Lower rates can definitely make borrowing more affordable and enticing, which could motivate more buyers to jump back into the market."
McKinney also highlighted how sellers might respond to lower rates. "We also have to consider inventory," she noted. "If rates drop again, more sellers will likely list, giving buyers more leverage. There’s potential for increased activity if buyers feel like they’re getting more value for their money, and we could see more inventory and options."
Having worked with Serhant for nearly eight years, McKinney transitioned from focusing on rentals to handling high-value deals under his mentorship. She achieved significant success by closing a $31.5 million deal at the end of 2023.
McKinney's outlook aligns with predictions made by Serhant earlier this year when he forecasted a buying boom in Q4 during an interview with Neil Cavuto on "Cavuto: Coast to Coast."
"Housing is defined by three things: You’ve got supply, you’ve got demand, and you have rates," he said during his August appearance on Fox Business. "So if there are significant movements in rates, you’re not going to see significant movement in housing purchases or sales immediately, but you’ll start to see it in the following quarter."
The Fed's interest rate reduction brought its effective benchmark rate down to approximately 4.8%, from a two-decade high of around 5.3%. Although mortgage rates do not always mirror interest rates directly, they often trend similarly.
Mortgage rates have already decreased by roughly one percentage point since May and dropped further to 6.09% for the week ending Sept. 19, according to Freddie Mac.
Alerts Sign-up