As anticipated, the Fed did indeed raise the Fed Funds Rate by .25% on December 19th but mortgage rates have continued their slide downward since then and are now at lows not seen since early 2018. Global indicators might suggest that the Fed will change its current stance on rate hikes in 2019 and we could actually see them cut rates depending on economic conditions. Fed Chair Powell will be speaking this Friday and we will be listening closely for clues as to the Fed’s intentions.
What does this mean for your clients? First, home prices have seen a pull back and rates are falling. This is a perfect situation for your home buyers to get into a new home! In addition, the Fed’s decision to raise rates will impact your clients’ variable rates, such as credit cards and HELOCs. With variable rates rising and fixed rates falling, now is also a great time for existing mortgage holders to consolidate other debts by refinancing.