Why property loan rates may rise if the Fed cuts by 25bps: Redfin chief executive officer



The average rate for a 30-year fixed property loan was flat at 6.35% for the week ending September 5, according to data from Freddie Mac. Redfin chief executive officer Glenn Kelman (RDFN) says that homebuyers are very slowly responding to the drop in rates, saying he has “never seen buyers respond so sluggishly to low loan charge rates.” Kelman attributes the lag to a few different factors, including waiting to see what the Federal Reserve will do at its September meeting. However, he notes that “mortgages have already priced in at least a quarter-point cut, and if that is all that we get, we might actually see property loan rates increase, whereas if we get a 50 basis point cut, rates will drop further.” Another contributing factor, he says, is the lack of listings, with some areas having stale inventory. What will it take to get the housing industry moving?
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