Real Estate Blog

A daily blog of the real estate market in Florida

Federal Reserve Bank Rate

Randy, what’s your take on the Federal Reserve’s decision to leave the key bank lending rate unchanged?

I think the Federal Reserve Bank would have been crazy to increase the rate they charge the banks.  It would have only been a domino affect for sure and the banks would have increased consumer mortgage interest rates – we can’t have that!  If interest rates are still so good, why aren’t more buyers taking action?


  1. rbianchi Said,

    Hey Don,

    Some buyers are taking action; we are working with several buyers right now. Housing prices are relatively quite low and as you pointed out so are mortgage interest rates.

    The problem is, these are generalized statements and not everyone has the same opportunity or desire to take action. Today’s economic indicators, such as Consumer Confidence, don’t support the justification for making major purchases. Lack luster consumer confidence is one reason why some buyers think real estate prices will drop even further. Market conditions, and in turn property values, are influenced up or down by what’s happening in the daily lives of consumers. Most buyers need to finance their purchase and right now there are several groups of people that can’t qualify for a mortgage. Obviously these groups of unqualified buyers include many who are unemployed, as well as those who are self-employed and can’t or don’t document their income to the satisfaction of mortgage underwriters. Lastly, remember that anyone who settled a debt for less than what was owed, e.g. a short sale or foreclosure won’t qualify for new financing for a least another 2 years.

    You are right, there are many more buyers that could be or soon will be able to take advantage of this buyer’s market. They are watching and waiting though for signs of economic confidence not just in their own household but in the families and neighbors around them. – Randy Bianchi

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