Fed's interest rate cut is a good sign for home sellers and buyers

ORO VALLEY, Ariz. (KGUN) — In a major move on Wednesday, the Federal Reserve cut interest rates by half a point. This marks the first cut of its kind since the COVID-19 pandemic, and prior to that, the 2008 global financial crisis.

Experts say this decision could provide some relief to both home buyers and sellers.

Veteran real estate agent Lisa Bayless, who has 17 years of experience with Long Realty, notes that while the rate cut may not seem large, it could have a notable impact on the housing market over time.

"You should always think about the long run," Bayless said. "It’s not going to happen overnight, but the change in the housing market should come soon."

According to Zillow, the average home price in Oro Valley is around $500,000. Under the current interest rate of 6.62% for a 30-year mortgage, monthly payments would be about $3,200. Bayless says the rate cut will eventually lead to lower payments and improved affordability for home buyers.

"It’s great news for would-be home buyers," she said. "In the long run, it will definitely make their payments lower and housing more affordable."

Bayless also pointed out that sellers could benefit from the cut, particularly those who locked in historically low rates during the pandemic.

"It might cause some people who have very low rates and have been hesitant to sell because they don’t want to give up their current rate to consider making a move," she said.

The housing market isn’t the only area affected by the Federal Reserve's rate cuts. Consumers may also see lower rates for car loans and credit card payments.