The Federal Reserve has announced plans to slash interest rates in 2024 in an effort to make mortgages more affordable for prospective homebuyers. The move comes as interest rates are expected to drop to 4.6% by May or June, down from the current rates of 5.25% to 5.5%.
With the national median home sale price skyrocketing from $322,800 in 2018 to $417,700 by the end of last year, the lower rates could provide much-needed relief for those facing high mortgage costs. The rise in housing prices has been attributed to the ongoing pandemic and a shortage of available homes on the market.
The housing supply shortage has been a major factor contributing to the high prices seen in many cities across the country. Experts say that it is unlikely we will see a decrease in national home prices anytime soon, with urban areas like New York, Chicago, and Seattle experiencing their own affordable housing crises.
In addition to high housing prices, homeownership is also being hindered by rising costs of living. Expenses such as groceries, gas, and childcare have been steadily increasing, making it difficult for many to save up for a down payment on a home.
Overall, the Federal Reserve’s decision to cut interest rates in 2024 is welcome news for those looking to purchase a home in the near future. However, the ongoing housing shortage and rising cost of living remain significant barriers to achieving the dream of homeownership for many Americans.
