Rate Cut - Why This Is A Huge Win For Both Buyers & Sellers

So after eight consecutive meetings, there is a half a point cut on the interest rates from the Federal Reserve. They say in light of inflation progress, as well as the balance of risks and the decision was not unanimous. The board of Governor Michelle Bowman voting against it saying that she believed a 25 basis point cut is the way they should have gone. The Federal Reserve signaled two more rate cuts for this year. If they go by 25 basis points, that makes a full percent down by the end of 2024. So there we have it. A half a point basis cut. Now what's that look like for us in the real estate world? We're currently at about 6.01% as far as our interest rates and a half a basis point while it doesn't correlate exactly the same is going to bring our rates down. That means let's say 5.75% rate, 5.6% rate, and remember, we've got some great lenders out there and these lenders will actually buy down that rate for one year because as we just heard, they're expecting two more reductions of 25 basis points, bringing us a full percentage down. So imagine looking for a home at this point. There's a lot on the market, so we've got some value add to that as well, meaning you're going to be able to negotiate when you're purchasing a property. This is the news we've been waiting for for a year. I mean, literally a year. I predicted last year around this time that the rates would come down and we'd be in the high fives. I was dead wrong. I got a pie in the face. It looks just like this. And I look stupid. However, this is really good. Fair warning, though. Take a look at this. Again, the labor market is actually in solid condition and our intention with our policy move today is to keep it there. You can say that about the whole economy. The U.S. economy is in good shape. It's growing at a solid pace. Inflation is coming down. The labor market is in a strong pace. We want to keep it there. That's what we're doing. That's Powell himself telling us this, and this is why we're a little more bullish on what's going on in the real estate market. Now, y'all think about this. If we've got good inflation finally coming down, thank heavens, and we've got employment numbers are looking good as well, that means we're in an optimistic position. Now, there's conversation out there. I'm going to do some stories on this as well, that we may have a recession that's in the future. I don't know if I actually buy into that, truthfully. I'm not sure if I do. I'll look into it some more. I'll bring some more data to it, but here's the thing. The Fed lowered the rates. This helps sellers by putting more buyers in the market, which is great news. It helps buyers by making, most important, homes affordable again. Oh, my God. How many times are you out shopping for homes, going from door to door, looking at properties, and realizing that they're all a little bit out of price? This half a basis point brings us where, if you could afford previously, let's say, a $500,000 home, you can now afford a $550,000 home. Think of it this way. There's a lot more buyers that are now back in the market. I did a video, which we're going to put at the end, that talks about how we are overpriced. We're actually unaffordable in Florida because of a lot of things, like our insurance. That adds to it. Homeowners Association. The insurance on your house. The taxes that are going up, as well as our prices just going through the roof, on average, about 40%. In fact, take a look at this. What you're looking at now is a five-year, year-over-year growth. Look at this. 58% in Kissimmee, Orlando area. 67% in the Fort Lauderdale, Miami, Pompo Beach area. 71% in Naples, 64% in Sarasota, 67% in Tampa, St. Pete, Clearwater, 55% in Jacksonville. We've seen our prices go up, so this is great news. We're now more affordable. I wanted to share that with you. It just came out right now. I wanted to get it to you live. I'm George. That's Jackie. If you have the opportunity, and thank you. We appreciate it. We'll see you real soon with more updates.