Mortgage rates have actually gone up nearly a month after Fed rate cut.
Potential homebuyers were hoping that a lower federal funds rate would bring down mortgage rates too but that has not been the case.
On September 18, Fed Chair Jerome Powell lowered interest rates by 50 basis points, although the average 30-year fixed mortgage rate has moved higher. Data from Mortgage News Daily shows the average 30-year fixed mortgage rate has jumped to 6.62% from 6.15% since the Fed rate cut.
Bankrate Analyst Jeff Ostrowski says it's not too much of a surprise to people who consistently check out the mortgage market. He senses homebuyers are growing frustrated.
"Even though they've come down, mortgage rates are still way above where they were for a couple decades and certainly well above where they were for the pandemic when rates fell below three percent," said Ostrowski.
Mortgage rates fell at a decent rate in the weeks leading up to the Fed cut, but the rates have been rising ever since the Fed cut. The Fed doesn't directly control mortgage rates but they are influenced by Fed policy.
Folks looking for a home in a tough market have to consider more obstacles than just mortgage rates.
"Mortgage rates are one reason for buyers to be discouraged but another is home prices," he said. "Home prices are near record levels and housing affordability is a real issue."
Ostrowski says home sales have been depressed ever since there was a housing boom during the pandemic a few years ago.
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