9 News: What the Fed’s interest rates mean for 2024 home sales

March 22, 2024

This week, the Federal Reserve again announced it will hold interest rates steady, but suggested three rate cuts could come sometime this year.

“The Fed rate certainly does have an impact on the 30-year mortgage, it's not a direct correlation but it definitely has an impact,” Abrams said.

And, according to him, realtors and their clients will be very interested to find out when those cuts will eventually happen.

“The question is still 'when.' [Federal Reserve Chair Jerome] Powell did mention there would be those three rate drops – and that’s what people are talking about,” Abrams said.

“The Federal Reserve doesn’t really do these things, does not tell us the plan for the year – so that in a way is an unusual step,” said Kishore Kulkarni, a distinguished professor in the Department of Economics at MSU Denver.

“So, because of that step, the market has really loved that news that interest rates will definitely come down 2 or 3 times in 2024," Kulkarni said. "And a reduction in interest rates means a nice opportunity to borrow more and do more things with the money.”

Kulkarni said some predictability gives the market a feeling of stability.

“I think the predictability of the future gives the stability to the market and to the economy as a whole,” he said.

As interest rates rose over the last few years, Abrams says he and other realtors helped clients find creative solutions, like seller concessions and buy-downs, to help buyers purchase homes more affordably.